Property: Finding the right time to trade places

IF YOU don't have to move house, it can be pretty hard to decide at what point to take the plunge. Just as the moment seems right, a new report comes out showing that the prospects look brighter three months down the road or, even worse, the market has slumped since the moment you started dithering six months ago.

Certainly, the climate can change in a matter of weeks. The latest interest rate cut has moved swathes of the market from neutral into at least second gear.

Enough at least for one London estate agent to decide that if he is going to trade up, the green light isn't going to get much greener.

Geoffrey Edmead, who works for Foxtons in Putney, south west London, feels it is time to act on the advice he has been dishing out to clients. He has put his two-bedroom maisonette in Fulham on the market and is looking for a three-bedroom Victorian terrace house.

Three factors clinched it: "The houses I could not afford earlier this year have come down in price; money is cheaper and there is a lot more choice. If everyone starts buying again in the spring it doesn't take long for that choice to evaporate."

Edmead calculates that even if the market were to slip further, and taking into account what he has spent on his flat, he could only gain on the trade upwards. "My budget is in the high pounds 200,000s and the very houses that were out of my range in midsummer at more than pounds 300,000 have now fallen back within my reach. Added to that are lower interest rates and very good mortgage deals. Even if I were to lose my job, I would find it no cheaper to rent."

The picture within London varies a great deal and the choice in high- density Fulham is not necessarily repeated elsewhere. In Edmead's own Putney patch, for instance, with its mix of standard Victorian terraces and top-of-the-hill, pounds 1m plus properties, turnover tends to be slower anyway since it is a popular area with families.

But as a buyer in a part of London where, he reckons, stocks levels have not been as high since 1994, the balance is weighted in his favour. "You can tell sellers are jittery because they are very keen to know exactly what you think of their house. It is clear that many are prepared to negotiate on the price."

In Chelsea, Douglas & Gordon, estate agents, share the view that the current market is ideal for trading up. "With a drop in house prices of approximately 10 per cent, if a client were to sell their house which is worth pounds 350,000 they may lose out on pounds 35,000. But then when they buy their bigger more expensive house of around pounds 700,000 they will make a saving of around pounds 70,000," says Edward Mead.

Since prices are localised, it is usually only by trading up in the same area that a good buy can be judged as such. One of Mead's clients has just sold his two-bedroom maisonette for a three-bedroom house and, even though he has doubled his expenditure he has saved himself between pounds 60,000 and pounds 70,000 by buying in the present climate.

In the prime central London market, activity in the last few weeks has allowed everyone to breathe more easily. Fears of a recession have passed and the cloud over the City has partially lifted.

The fall in interest rates has less effect on this sector than any, but it does have a psychological impact, says Jonathan Hewlett of FPDSavills.

It encourages a few more to come off the fence. Buyers are happy with prices which are at high enough levels to satisy vendors as well, he finds. "There is more choice at the moment, with a good street often showing two or three good houses instead of just one. There is also plenty of new property around with developers pricing more sensibly."

Willie Gething from Property Vision, the specialist buying agency, points out that the market divides into those who need to sell and those who still believe they can get the prices of six months ago. If you are buying from the first category it is a good time, but if you buy from the second, you will pay over the odds.

In the country, where the market reacts more slowly, buyers feel less panic and more confidence in the chances of negotiating a price. Price falls may be something of an illusion among properties for which there is always a high demand.

James Laing of Strutt & Parker says estate agents certainly can't sit in their offices and wait for the flood of buyers. "The old rectory that would have sold for pounds 600,000 to the first buyer who wanted to stop the competition is more likely to go on the market at pounds 540,000. In the end the difference is not in the final sum but that we are now having to push buyers up to that price."

It can only encourage buyers to know that those who do not have to sell, are sitting tight or letting. Linda Beaney of Beaney Pearce is cautious about the strength of the current market.

"I would be inclined to advise people to wait until the end of January or February of next year," she comments. "I firmly expect one or two more cuts in base rates by the early part of next year. However, if someone is selling a place in first-class condition in an excellent location with no problems then it is a good time to trade up, but not if the property is second rate."