Property: London leads the way out of recession: Agents around the country say quality is the key to sales. Jojo Moyes reports

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The Independent Online
'I 've just been out with a couple with half a million pounds to spend. They've been looking for four weeks, and there's nothing for them.'

Big, expensive houses are starting to sell again, according to reports such as this one from a north London estate agent. Activity in the sector hardest hit by the property slump supports the view of agents across the country that the market is creeping back to life.

'We've sold 12 houses in the pounds 300,000 to pounds 750,000 range in the past three months. Now we've got buyers but no houses,' said Neville Casingena, of Goldschmidt and Howland in Hampstead. He attributed much of the increased interest to overseas buyers using favourable exchange rates to get a good deal. Other agents in the top price bracket agreed.

Neil Gilchrist, of Lassman's in Mayfair, said: 'There's actually been an increase in the values of the very large properties simply because there aren't enough now to satisfy the demand. You couldn't sell Nash houses in Regent's Park last year. They're priced at pounds 1m and over. Now we've sold five since February, and there's another three going through.

'An overseas buyer can make a saving of about 50 per cent at the very top end - a 25 per cent reduction on the prices of two years ago, and a 25 per cent saving on sterling.'

Movement at the top end of the market was also reflected in the experiences of agents outside London.

'Quaint cottages are always popular - they have kept their prices well,' said Andrew Butler, of Halifax Property Services in Skipton, on the edge of the Yorkshire Dales. 'But I wish we had more character properties of pounds 250,000 and above - it really is all about quality now.'

Another recent development, said Mr Butler, was the return of the holiday-home buyer searching for a bargain property in the countryside.

'The second-home buyer seemed an extinct breed in the past few years,' agreed Chris Forrest, of Bettison and Co in Yealmpton, Devon, 'but we are seeing people coming back into the holiday-home market. A lot of people did well out of the recession - there's still money around.'

Inquiries, viewings and sales are all said to have improved in the past three months on all kinds of properties. But prices show few signs of increasing, and some agents believe the market has not yet bottomed out.

'We've had more sales than we've had since the late Eighties,' said Mr Forrest. 'The caveat to that is that vendors are being realistic about prices, and recognise they can buy on the same terms that they sell.'

Kim Lowe, of Allen and Harris in Devizes, Wiltshire, said: 'There are a lot of properties reaching their asking price, but they are priced realistically. That does not necessarily mean cheaply. Houses that have been on the market since Christmas that are priced realistically are generating more interest than those from last year which haven't dropped in price.'

Phil Barker, of GA Keys in Norfolk, agreed: 'There is this peculiar thought by the general public that although their house is worth pounds 60,000 they should put it on the market at pounds 70,000. But buyers aren't daft and won't even bother looking at it if it's not in their price range. There are too many other houses around to look at.'

Mr Barker added that, although the market was getting busier, it would be a 'grave mistake' for people to think that prices would rise. 'Buyers are being cautious, to ensure they are not paying over the odds,' he said.

The backlog of properties also means that buyers are able to hunt for houses that fit their exact requirements. One agent said he had so many bungalows on offer that a purchaser was able to pick and choose on the basis of which colour bathroom suite she liked best.

Outside London and the South the mood is still hopeful, but more circumspect.

Paul Farmer, of William H Brown in the suburbs of Nottingham, said: 'The comments that come back are, 'We don't want to make a decision just yet - there's no hurry, is there?' People are still shopping around. There's more confidence among buyers, especially those who have sold their houses or taken rented accommodation for a few years. But there's still a little way to go.'

Clive Robinson, of Hockley's in Norwich, agreed: 'There's so much on the market - people really do have a good look around.' He, like most agents, said that the first-time buyer market was moving fastest, and added that time limits on special mortgage deals were stopping buyers taking too long to make up their minds.

More than one agent reported having property on the books for more than three years. Failure to sell was generally attributed to over-optimistic valuation by the seller. Some owners had even forgotten that their homes were on the market.

Many agents also reported that, in spite of the high incidence of negative equity, sellers were accepting low offers more readily than last year, simply because they were fed up with waiting for the market to improve.

In Scotland, where the property market has suffered less, agents were also reporting a flood of homes and a cautious-buyer market.

'Anything that's overpriced is not going to sell,' said May Cormack, of Royal Life Estates in Helensburgh, 'but, funnily enough, a lot of housing estate properties are quite keenly priced and agents are not able to shift them. They're the slowest end of the market.'

Fear of redundancy was cited as the biggest block to confidence among buyers in the lower brackets. But lower interest rates and attractive mortgage packages were ensuring the first-time buyer was still the backbone for the rest of the market.

'Although there hasn't been a vast increase in wages, people's incomes as compared to interest rates have probably never been better,' said Phil Barker.

The absence of chains and reduced pressure on buyers were also making property sales a less painful process than they were five years ago, according to some agents.

'There's not the same sort of panic to exchange before prices went up yet again, like there was in the Eighties,' Mr Barker added. 'Both buyers and sellers don't seem under the same sort of pressure.'

But many agents expressed concern that people would be panicked into thinking another boom was on the way. 'We had a man in recently who was five years off retirement and desperate to find a retirement home because he thought the prices were going to shoot up again,' said Mr Butler. 'It is not actually happening yet.'

Chris Forrest said: 'The last thing the market needs is to be hyped up by building societies saying prices have risen 1 per cent in a month - it really doesn't help. What the market needs is stability.'

(Photograph omitted)

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