Fisher German Chartered Surveyor’s experience of the 2006 market has seen an increase in average property prices of around 10% in comparison with 2005. Robert Russell of Fisher German’s Banbury office says “there is little sign of any significant decline in the confidence of the residential property market, with strong demand continuing to drive the market”.
House Prices rose by 1.4% in November 2006 according to Nationwide. The UK economy has now also recorded 57 successive quarters of growth. Fisher German is also finding that the residential development market and the commercial property market remains in good shape. Tenant demand remains strong in the commercial sector.
The recent sale of the Brackley Grange Estate by Fisher German has given increased evidence of the lack of supply of premium properties and how the market has ‘pulled away’ with city bonuses increasing demand for premium property investment.
Fisher German’s recent land auction in Towcester demonstrated there is still significant interest which is continuing to drive agricultural land prices up. All four parcels of land auctioned sold, with several parcels far in excess of their guide price, this is mainly due to demand from special purchasers (those that have an added incentive for buying land i.e. they own a neighbouring property). The total acreage sold equated to a figure of around £6,000 per acre. Matthew Allen of Fisher German comments “this demonstrates an increase in land prices due to limited supply and increasing demand, as well as land being more heavily lotted nowadays to realise its maximum value”.
Looking to 2007, with increased mortgage rates and the significant increase in recent utility bills, this is expected to constrain housing demand, causing the annual rate of house price inflation to slow in 2007. Robert Russell of Fisher German states “the large city bonuses expected to be paid out in 2007 may result in a greater difference from the middle to the top end of the market, and increase expectations”.
