It is 50 years since the death of Winston Churchill. He once said, “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty”. You could argue that this mantra still holds for the property market, near to London, in 2015. The pessimist will look to an uncertain economy, the possibility of mansion tax, interest rate rises, and thus shy away from the market. The optimist will see that London is 35% higher than at its 2007 peak, compared to a commuter belt that is only around 5% higher than at its 2007 peak, and therefore spot that the areas immediately outside London, such as Surrey, are ripe for growth. In fact, predictions suggest the South East of England will, over the next five years, see price growth higher than London, estimates as high as 20%. So that optimist will conclude that the price gap between their house in London and the leafy villages of Surrey has never been higher, and their new house in the country will outperform the London market over the next five years. Whilst the pessimist dithers the optimist could beat them to the punch.
However, Mr Churchill also said, “The only statistics you can trust are those you falsified yourself”. In England the sport of second guessing the property market, looking for trends, basking in the glow of price rises and dreading the curse of negative equity, is one that many of us enjoy. The property websites and glossy property magazines are full of information and pictures of beautiful houses. The statistics (not made up, I hasten to add) suggest that the property market in the Home Counties will continue to grow, in some cases faster than London. Therefore rather than taking the quote to mean that figures lie, the meaning, in this example, could be the numbers alone should not drive the house that you buy, or the area you live in.
A lesser known quote from a comedian, who worried that he had purchased the most expensive house in his road, said he was going to buck the trend on the obsession of house pricing and "use the house for its primary purpose as a domestic dwelling" and "bloody live in it!". As a nation, we spend many hours looking at the pricing of property, the relative benefits, and the potential increase in value. This can lead us to forget the fact that the primary goal is to find somewhere to live. We never lose sight of the numbers, but we also spend time looking at whether a client actually wants to live in it.