OVER the course of 2011, and in spite of global market conditions and the continuing difficulty to secure investment and development funding, a significant proportion of property stock has been sold and let across the North West.
A greater proportion of the deals have been cash-driven, with particular regard to secondary stock and those properties which are distressed.
This cash focus has, inevitably, put a downward pressure on values, but the steady level of activity does indicate continued demand in this sector within our region.
Indeed, in various localised areas of the North West, demand for secondary industrial or retail property has led to a competitive bidding process resulting in sale prices well in excess of expectation.
By contrast, a real deficit of primary property stock in the regional market has become increasingly evident this year, and funds that would normally invest in prime assets in the region have tended to sit tight, drawing income from existing holdings.
This has become something of a vicious circle the fewer assets available, the higher the price sought, the more likely investors will wait, causing something of a stalemate.
The shift in the supply/demand balance has consequently raised the asking price of some assets to the degree that they become bad value in the long term for potential purchasers, exacerbating an already complex market state.
So what to expect for the coming year?
Although the primary property market is likely to remain tricky for a while, due to the continued lack of stock, when assessing the regional property market as a whole I would suggest things are looking up.
Cash purchasers continued confidence in the region is evident, and should mean they will continue to invest, albeit at current values.
Furthermore, we have seen an increase in enquiry levels for both sales and lettings within the occupancy market in the Merseyside area, as local businesses try to grow through relocation.
Although the national picture is shaky, I would argue that the North West, and Merseyside in particular, is well placed to buck the trend.
