as clear as the media would have you believe.
Firstly, most news agencies quote data from Rightmove who base their evaluation on ‘asking prices’ not ‘sold prices’ and second, the 10% rise in ‘asking prices’ was based only on the borough of Westminster, which year after year level pegs with Kensington and Chelsea as having the highest house price growth in the UK.
As property search agents, we are the first to recognise that the market cannot keep rising at this rate without a fall at some point.
After the crash of 2007/2008, the market fell an average 25% from its peak of 2007 after one of the worst financial crises since the great depression. The central London market is now on average 35% to 40% above the dark depths of 2008/2009.
But, when the crash happened not all areas, streets or even properties fell by 25%. Some fell 10%, some 40%. The reality being that some properties always outperform the market, the same way some stocks outperform their market or sector, and some will fall faster in a crash and bounce back slower.
Nobody wants to buy at the top of the market and of course everyone wants to know when the best time to buy is. As search agents, we regularly get asked – ‘do you think now is a good time to buy?’
There is never a wrong time to buy a property in London - but there are wrong properties to buy.
Without doubt, the market has risen dramatically over the past three months and some areas are starting to look overvalued.
We are advising our clients to be cautious about certain types of property in certain areas.
But, are we in a bubble just yet? Maybe we are… a small one perhaps.The market might take a dip, but this is just a natural correction that has to happen to all healthy property markets.
Regardless whether the market dips 5% or 10% - it will bounce back as fast or faster than it dropped.