Business Sale Market Review
January has started with a bang and we have experienced very solid levels of buyer activity. This has translated into more offers and more deals being put to solicitors. That being said the deals that are happening are being struck at sensible prices and for respectable multiples. There are no extravagant purchasers out there, in fact far from it, they remain very cautious, very slow and determined not to over-pay.
My own view is that we are seeing a long term trend in stable asset prices and apart from the volatile London property market caused by the low sterling and overseas buyers, I see this translating into pretty static property prices for a number of years yet. One interesting trend that has started to appear in the regional property market is the number of higher value properties owned by ageing baby boomers who want to sell their houses and release money for their retirement, being forced to take very significant price reductions. As more baby boomers reach retirement age, I suspect that this trend will accelerate in the housing market and I also suspect that we will start to see it appearing in the business sales market. At the moment the number of potential business buyers far exceeds the numbers of businesses for sale and it will be interesting to see whether this ratio will change over the next ten years. One positive trend though for business sellers is that we are also seeing retirees from the City appearing as business buyers because they have taken early retirement, redundancy or need to supplement their pensions. Again I foresee that this will be a growing trend.
Finance remains accessible although the banks won’t lend to just anyone. Our independent finance broker had a cracking 2012 and raised over £37 million of business purchase finance for his clients and every single one of his finance applications was sanctioned. Please rest assured that we push his services towards all those buyers who are looking to raise finance for their purchase in order to increase the chances of a sale.
We also now have two new law firms on our panel and if you are in need of a solicitor who will not only provide you with an excellent and professional service but also at considerably below market rates, then please contact one of the team at Turner Butler and we will pass on their details to you.