It will take months before the top of the housing market can benefit from the Government’s pump priming of the bottom end, Tom Dennes, head of CPBigwood’s Stratford-upon-Avon based Country Homes division, has predicted.
His comments follow David Cameron’s new £400 million initiative which aims to “unlock” the sector.
Set to start next July, it aims to provide 16,000 new homes and create 32,000 jobs in England. Buyers of new homes will be offered the ability to borrow 95 per cent of a property’s value with the Government underwriting some of the risk via a mortgage indemnity scheme.
Mr Dennes said: “The Prime Minister has claimed this will get builders to build, lenders to lend and first-time buyers to buy.
“As an initiative it is a good thing, sends out the right message and is to be encouraged. In theory it should work if it is carried through.
“But land has to be identified, planning permission sought, so nothing will happen for at least a year. The effect will take even longer to filter upwards. And there lies the conundrum.
“The reality is … this can’t be done overnight. So, although it is welcome, it is not going to make much difference to the market in the short term.
“Quality homes in good locations are generating demand – for example, one of our properties, No. 5 Tyler Street, an elegant double fronted Grade II listed late Georgian town house in Stratford, with a guide price of £935,000, went on the market at the beginning of October was advertised, viewings conducted, a sale agreed, processed through the lawyers and contracts exchanged, all within six weeks.
“Demand is there – but generally you have to work harder to get deals over the line. That is going to be the case for some time to come and is where our expertise can make a difference.”