Property investors 'sense now is the time to buy'

The economic downturn has had a major impact on the UK housing market over the last year, with prices dropping dramatically to levels not seen for more than half a decade. However, while the media churned out 'doom and gloom' stories about the impact that the recession was having on people's property investment portfolios, a number of experts suggested that the slump was actually a good thing for buyers. It would not last forever, they said, and when it reached its bottom it would present an excellent opportunity for investors to purchase property at cheaper prices and then watch them rise in value in the coming years.

Now, according to one expert, that time appears to be at hand. Lucian Cook, director of residential research at Savills, remarked this week that property investors are beginning to realise that the market is not going to get much lower and that it is looking like a good time to make a purchase.

"Since April, the transaction levels have really started to pick up and buyers have sensed that we are sufficiently close to the bottom of the market that now is the time to be buying," he remarked.

His comments were made in response to the latest statistics from Hometrack, which revealed the average house price for June was £155,600, the same figure as was recorded in April and May. This three-month hold followed an 8.7 per cent price decline over the previous year and Mr Cook claimed he was not surprised by the numbers.

Hometrack also reported that the average property was on the market for 9.4 weeks in June, down from 9.9 weeks in May and 10.4 weeks in April.

"The reduction in average time on the market I think is right and that is a function of there being a lack of stock on the market," Mr Cook explained. "What you have had in very general terms, is applicant numbers have been building since the beginning of the year."

Indeed, the volume of buyers rose by 36 per cent over the first six months of 2009, Hometrack discovered. This compares to an increase of 6.4 per cent in the number of homes for sale in the marketplace. This supply and demand situation also appears to be affecting the ability of vendors to get the asking price for their properties, with the proportion rising to 91 per cent in June from 90.3 per cent in May.