Today's guest blogger is Martin Stewart the director of London Money, a firm of regulated financial advisers uniquely positioned in the heart of London from where they help to guide, build and facilitate a client's financial plan.
Their strength and skill set is focused primarily on the arranging of most types of personal and commercial finance.
Guest Blogger: London Money
I remember this process very well, it was only 3 years ago that I did this myself.
Cut to 2014 and what do we see? Well the quick answer to that question is complete and utter chaos. The home buying model is broken, particularly in London, and a new more sinister model has begun to emerge.
So, no time to really think, no time for due diligence, no time to compare and contrast. No, not anymore. You have spent all of 15 minutes looking at something valued at £500,000 and it all boils down to a “do you wannit or not?” I have spent longer debating which sandwich to get from M&S. This new house purchase model makes the old bidding at an auction scenario almost pedestrian by comparison.
Here are some first hand anecdotal situations we have come across in the past few weeks alone:
- A client buying a probate house in North London overbid the £725k asking price by £100k. He didn’t succeed, someone else bid £200k over
- A client looking at a 2 bed flat in Greenwich was just one of 16 firm offers put in on the place within 48 hours of the open day
- A client looking in Wimbledon found himself shuffling around a house with 30 others . It transpired 28 of them were buying chain free.
Let me be clear here. We are not referring to “Super Prime “ properties in the currency havens of Mayfair and Kensington. These are AVERAGE properties in good areas which AVERAGE people are now finding impossible to buy.
These current market conditions are just one of the many massive social changes which we will continue to witness as the fallout from the credit crunch permeates. We could go back further still to the easing of credit at the start of the Century for the original route cause.
“Oh what a tangled web etc etc etc”
One of the major casualties of the current housing crisis( and it IS a crisis) is the first time buyer. They have for all intents and purposes become redundant in the home buying process. In the space of 5 years they have gone from being the life blood of the market to being a bloody nuisance. They have, as you can probably guess, been replaced by Buy To Let investors.
As usual the powers that be continue to sleep walk us all into the abyss. We do NOT need ANY Government sponsored initiatives anywhere near London nor probably the South East. Let the ten worst performing regions in the UK have all of that money (and more).
We get asked by virtually everyone we meet “are we in another property bubble?” Our answer is “Yes, because we never left the last one“. We never naturally corrected the market. We just pumped it full of steroids and cheaper credit. Will it crash? Who knows? I sincerely hope not, unless you really want to live in a London that will resemble that of the film 28 Days Later. My feeling is we are too interlocked, we can’t escape even if we wanted to. When a country like ours is owner occupied to the tune of 70% the basic utilitarian principle of the greatest happiness for the greatest number of people prevails. My vested interest is your vested interest and vice versa.
I can see what Cameron was saying now . We really are all in it together. Right up to our necks.