Despite some recent issues caused by a storm called Doris, the weather is generally improving and becoming warmer and the days are becoming longer and lighter as we move into spring. As someone might have once said, a day is a long time in weather forecasting, it is not dissimilar in property!
After a year of enormous change both politically and economically in 2016, we entered 2017 more certain about many things and less certain about others.
The Government is about to trigger Article 50 and commence the formal process of leaving the EU. This is a huge decision but one that, to date and in the foreseeable future, has had little or no impact on the residential property market as the public have decided that they, quite rightly, need to get on with their lives and take the decisions they need to take.
Mortgage interest rates remain at historic lows and there are many very attractive fixed rate schemes enabling buyers to make commitments with complete certainty over costs. Unemployment levels continue to reduce and, whilst there may be some inflationary pressures, the general economic outlook remains positive.
The Government has made a number of politically motivated moves in the private rental sector designed to encourage more home ownership rather than seeing greater volumes of investor purchases. A 3% hike in stamp duty on second homes and investment purchases came into play last year and this spring will see reductions in tax relief for landlords with buy to let mortgages. Changes to wear and tear allowances will also slightly impact on landlords.
Demand from tenants however remains high and good rents are being achieved for landlords with attractive, well managed properties.
Certainly there have been a number of reports indicating growth in the number of first time buyers entering the market - wages growth is starting to move ahead of house price growth and the aforementioned Government “interventions” – plus Help 2 Buy – is enabling more young people to purchase.
The recent white paper designed to, in the Government’s words, “fix the broken housing market” was high on rhetoric but low on practical plans. It has however put an emphasis on more housebuilding and affordability. If they can encourage and achieve this, it will hopefully help redress some of the imbalance between supply and demand.
The reality is that we need a housing market that offers a variety of tenures – owner occupation and private and social renting. Demand across all sectors continues to outstrip supply which means prices will hold or rise in the predictable future.
Our view is that the market is absolutely fine and there will be nothing to impact either negatively or particularly positively in the coming months. A “steady as she goes” scenario seems likely.
Key to successfully selling and buying, letting or renting is to obtain the best advice from experienced local professionals. Knowledge of the market and an accurate valuation are key factors.
As always, our team are here to help.