Gazumping returns to West Country property market as house prices rise by 10 per cent
07-04-2014
By Western Daily Press By Jeff Wells
Confidence among house buyers is returning, with gazumping a more common practice as prices increase
Rising house prices in the West Country are bringing a return of gazumping and sealed bids to the housing market as buyers' confidence grows.
Prices across the UK have risen by 11.8 per cent in the past year, according to Nationwide report – the largest annual jump since 2005 – with the West Country close behind on 9.8 per cent. Prices in the capital, meanwhile, have risen by more than 25 per cent in the same period.
And though estate agents in the West Country say the local market is a far cry from what's happening in London, there's no doubt there is more confidence. Nick Woods, director of Woods Estate Agents, said the market was becoming more buoyant.
"Values were static last year but now there is a gentle upwards trend," he said. "It's not a bubble – values are remaining sensible – but there is a lot more activity.
Mr Woods said rocketing prices in London distorted the national and regional picture and said the return of gazumping, in which a last-minute higher offer is accepted over a previously agreed price, was not the sign of the market becoming unsustainable.
Andy Goundry, owner of Goundry's Estate Agents in Cornwall, said that while house prices in the county had not grown by double-figure percentages, there was no doubt they were increasing.
He said that year-on-year price rises of between 6-7 per cent were common, but there was no doubt demand was higher than supply.
"We are not seeing that 11 per cent rise talked about nationally," said Mr Goundry. "At the moment the market is healthy, I would say."
Mr Goundry said limited supply and new, more stringent mortgage rules were making it tough for many people to take their first step on the housing ladder.
One property recently marketed at £360,000 had been quickly revalued at £375,000 and was now likely to go to sealed bids, he said.
Nationally, the annual uplift is the biggest jump seen since January 2005 and a 1 per cent month-on-month price increase also helped to push average prices to £2,391 above a previous peak which had been recorded just one month earlier, in May.
Robert Gardner, Nationwide's chief economist, said house prices surpassed their 2007 peak levels in the second quarter of this year, "just as UK economic output is likely to have surpassed the high water mark reached before the financial crisis".
Last week, the Bank of England moved to put curbs on riskier mortgage lending by announcing that loans of 4.5 times a borrower's income or higher should account for no more than 15% of new mortgages issued by lenders.