The property market apocalypse predicted by some following the Brexit referendum appears to have been averted. However, the timing of the referendum, combined with the 1-2 month lag in the reporting of sales figures has made it difficult to assess the real impact.
The latest sales figures reported by the Land Registry/ONS suggest a 10% decline in transaction volumes against the same time last year but this could simply be a result of April’s rush to beat the Stamp Duty increase on second homes and buy to let investments. House prices are reported to have risen by 8.7% nationally over the year with the average property now standing at £229,000.
The important thing is to look at the snapshot of activity right now. We’re at the tail end of summer, yet demand remains high. Nevertheless, buyers feel they can take advantage of the scaremongering they read in the press and are confidently offering lower figures than they might otherwise have done. Sellers on the other hand are relying on the “everything’s going to be fine” approach and are in holding firm on prices.
Rightmove has reported a 1.2% decline in asking prices of new-to-market properties in July, but this is usual for the time of year and nothing seems to have changed significantly enough for us to expect anything other than the usual Autumn boost due to commence shortly. Indeed, this month’s announcement of a new record low BoE base rate to just 0.25% can only help and this has been followed by announcements of exciting mortgage products that point to the City’s long term optimism (eg 7-year fixed rate at 1.99% by Coventry BS). So borrowing continues to be particularly
cheap, with risk being reduced by these long term fixes.
It’s early days but all the signs are that it’s business as usual for the property market with now probably being as good a time as ever to either buy or sell, remembering that property should really be regarded primarily as a home, and any investment gain is simply a tax-free bonus. So perhaps let your personal housing needs be led by your heart, but endorsed by your head.
Neil Newstead, FARLA MNAEA
CEO – Oakfield Estate Agents