Big housing crash? Not in Shropshire, there isn’t

Estate agents in the county say they don’t recognise warnings coming from some following disappointing house sale figures coming out of London.

Trends in the capital often end up being repeated in other areas of the country.

But experts here insist Shropshire’s housing market is still robust thanks to the variety in the county’s economy, estate agents have said.

This week two London-focused agents published half-year results reflecting a declining market in the capital, but Shropshire businesses insisted they were experiencing no such downturn. Foxtons, which operates exclusively in London, said revenue fell 15 per cent in the first six months of the year, while Countrywide – the UK’s biggest listed estate agency – shed £33 million of sales over the same period.

The weakness was largely because of a downturn in property transactions.

House sales exchanged fell 20 per cent on a like-for-like basis during the period, while exchanges in London fell 24 per cent.

But Shropshire is not experiencing the same struggles, and local agents insist that is because the county’s economy benefits from variety, which protects it against the kind of shocks to have hit the capital following the Brexit vote.

In fact, they argue that the only thing holding Shropshire’s housing market back is a shortage of properties coming onto the market to meet demand from buyers.

Bill Brookes of DB Roberts Estate Agents said a recent auction of properties held by the business had seen some bidders offering £20,000 to £25,000 above the reserve price for homes.

“Every one of the 31 lots was sold,” he said. “It doesn’t indicate that there is any kind of slowdown. Levels of inquiry have remained very strong.

“We could actually do with more coming onto the market if anything, but that could equally be people anticipating being away.

“In terms of sales I don’t think Shropshire is suffering at all.”

The most recent official figures showed that house price growth in the county was fairly static between April and May.

But with Shropshire’s properties growing by 4.47 per cent year-on-year and Telford’s up 4.78 per cent, the annual growth is similar to the figures being delivered a year ago.

In contrast, the heat has come out of London’s market as investors begin to worry over the long-term future of the capital’s biggest industries.

Mr Brookes said: “The Shropshire economy is very broadly based.

“You have got some commuters who work in Birmingham and even London, and who travel from Shropshire. Then you have a very strong agricultural base with all the supporting industries alongside that.

“Then there’s some manufacturing, particularly in Telford but increasingly in Shrewsbury, and very good colleges and universities.

“Because you have that broad base then a big variation in one sector isn’t as noticeable.”

He added: “Then you look at London, which is being more affected by the potential Brexit situation with banks thinking twice about whether they want to be based there.

“The London market always has the extremes, the highs and growth when investors are piling in and you notice it more when big investors start to train their sights elsewhere. We don’t get that in Shropshire, it’s a far steadier market.”

Mike Nettleton, sales and marketing director at Nock Deighton Estate Agents, added that his company was also seeing the market remain very strong in Shropshire, and was not noticing a downturn as has been reported in other parts of the country more sensitive to economic shocks.

Strong

“The market is particularly strong here in Shropshire,” he said. “The main constraint is the shortage of available houses.

“Looking at our figures compared to this month last year, we have seen 10 per cent growth in valuations and a 30 per cent increase in sale completions for July.

“This would be consistent with a market where supply is struggling to meet demand.

“People taking a considered and practical approach to moving home will find the coming months will be a very good time to explore the market.” Latest figures from online estate agent Rightmove also point to a market that is not suffering the kind of shocks which had been expected. Revenue for the business grew by 11 per cent in the first half of the year, hitting £119.5million.

The amount of homes available remains a challenge, however.

The average number of properties on surveyors’ books has hit a new all-time low, a report found earlier this month.

Just over 42 homes were available for sale per branch on average in June, the Royal Institution of Chartered Surveyors (Rics) said.

A net balance of seven per cent of surveyors across the UK saw prices rise rather than fall in June, but in May more surveyors had been seeing prices increase, with an overall balance of 17 per cent.

Surveyors’ expectations for house sales in the coming 12 months had fallen to their weakest levels since the aftermath of the vote to leave the EU in 2016, Rics said.