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From The Sunday Times

October 14, 2007

The property market: October 14, 2007

The Pre-Budget Report, the country house market and home information packs

Viewing the property for sale in the window of an estate agency in Hove, East Sussex. Pictured: sales executive Adam Jones and secretary Sarah Woodman

Graham Norwood

- The government says it will spend more than £4 billion in the next three years to help people in poor-quality housing renovate. The proposal was announced by Alistair Darling, the chancellor, during last week’s prebudget report. However, Warren Bright, chief executive of Propertyfinder. com, a web portal for buyers and estate agents, says that, according to the government’s own estimates, £35 billion is needed to bring the 5.5m homes registered as “nondecent” up to scratch, so the allocation is only a “drop in the ocean”.

- The market for Britain’s poshest country houses has almost ground to a halt, admits Savills, the nationwide estate agency. Prices of £1m-plus rural retreats increased by an average of just 1.4% in the third quarter of 2007, slightly reducing annual inflation for this type of property to 11%. The firm says City uncertainties mean the traditional summer lull has continued into autumn. “Price growth is unlikely to be starting in the coming months,” concedes Crispin Holborow, director of country-house sales.

- The US arm of Foxtons, the London estate agency, is reported to be filing for bankruptcy. Foxtons North America, based in New Jersey, has laid off 90% of its 300-plus staff. It has told owners of the 4,400 properties on its books that their instructions will be sold to another agent, if one is willing to buy.

- Home information packs continue to affect the market, claims the Royal Institution of Chartered Surveyors. It says 73% of its members report a drop in the number of homes on sale with three bedrooms or more – the size requiring HIPs. The worst affected areas are East Anglia and the West Midlands. The government has indicatedthat HIPs might apply to all homeson sale by the end of the year.

- House prices in Wales have fallen by an average of 0.3% in the third quarter of 2007, taking annual inflation to 5.5% – well below the all-UK average of 9.3%. Figures from the Nationwide building society show that a typical Welsh home now costs £153,655. Price growth in Cardiff for the year to October was 5%, far below nearby Bristol, at 17%.