It’s easy to see why economics is called ‘the dismal science’. If you’re of a sensitive disposition and easily bored, put your hands in front of your eyes when viewing the latest figures from the Office of National Statistics.
These graphs have more spikes than a cactus needle caught in your underwear.
Inflation is rocketing towards the stratosphere causing a ‘cost of living crisis’ and spiralling interest rates are in hot pursuit. But we must be grateful for small mercies – the UK is not yet in a 1970s-style stagflation vortex and low unemployment means companies are scraping through the bottom of the barrel to find workers.
But the Treasury must lie awake at night with its collective hair on end, as UK growth projections are moving south. Meanwhile, the capital markets are all of a dither as they nervously bite their nails fearing the Apocalypse.
Herein lies a paradox. Amid this economic maelstrom houses and not than apartments (between £1 million to £3 million in London) are still very much sought-after and a half-decent agent can summon 20 likely purchasers within two weeks of an instruction.
Housing market
This invariably results in four to five competitive bids and a sale at the full asking price. It’s no wonder sellers are pleased with themselves and their agents right now.
We deliberately use a guide price rather than an asking price in these scenarios, allowing a determined buyer to go beyond the Rubicon… if they dare.
New homes that have been built over the last two to three years in the £1million to £2million sector are still in demand too, but to a lesser extent than older houses.
Sales of prime property in London more than £10million are still taking place but the market is a little patchy.
Now that Russian buyers have been cancelled, their replacements originate from the Middle East, Iran and Poland.
For the deepest pockets, look East. The Oriental oligarchs from China and Hong Kong are keeping the £20 million to £35 million market afloat.
We’re currently incubating an enquiry from the Middle East for a compound, at circa £400million. It’s so discreet I can’t even tell myself about it.
Right now, there’s a bizarre disjunction between the economic outlook and the gymnastics of the housing market. Maybe the latter will catch up, but until then, sales will continue apace.
To paraphrase the infamous Victorian playwright Oscar Wilde, the UK economy might be heading for the gutter, but at least the residential housing market is heading for the stars.
Apologies for my conspicuous absence over the last year or so. I am now ‘back in the saddle’, and much to your consternation you will be hearing a lot more from my desk, in future.
Trevor Abrahmsohn is boss of London prime agency Glentree Estates.
