As the dust begins to settle following the referendum the debate about what might happen next continues with opinions ranging from doom and gloom to euphoric optimism.
So what really is in store for the housing market? Let’s first review what has happened so far during 2016. The year started strongly with property prices continuing to rise steadily across the region driven by a shortage of supply, low interest rates and a rush from investors and second homers looking to complete a purchase before the changes in stamp duty. The spring market brought even greater competition between buyers, particularly in the mid-market of £400,000 to £800,000 with a significant proportion of sales being agreed in excess of the asking price. Economists suggested the market would continue to boom should we ‘remain’ with sharp falls in transactions and values if we decided to (Br)exit.
In the wake of the result not a lot appears to have changed. We’re still registering plenty of new buyers. Potential vendors are still requesting valuations. Sales are consistent with early June and existing sales continue to exchange contracts. In fact, the vast majority of clients and customers are upbeat and determined that life simply must go on. So far so good.
Should we be concerned? It seems inevitable that the economy will contract and transaction levels will reduce a little as the media fuels the fires of uncertainty. The key is to remember the many reasons for optimism. Whilst sterling is suffering, foreign investors will view this as a great opportunity to acquire property, particularly benefiting commuters from London and Cambridge. Interest rates will continue at an unprecedented, affordable level (perhaps even lower) giving opportunities to younger buyers and families. Low interest rates on savings and uncertainty surrounding pensions will continue to see retired couples downsize, releasing capital from their primary home. The demand for housing remains significantly greater than the supply. And perhaps most importantly, our wonderful region continues to provide excellent value for money to buyers leaving London, Essex, Hertfordshire and Cambridge making us an attractive destination regardless of the state of the housing market.
So to answer the headline, what happens next? In the short term the summer holidays will see overall transaction levels slow a little, coupled no doubt by negative headlines in the press. Buyers, sellers and estate agents must roll up our sleeves and work even harder to make the most of every opportunity. We strongly believe that by remaining positive, offering honest, straight talking advice and continuing to invest heavily in marketing both locally and nationally our business and the housing market will continue to thrive; it’s in our hands.
Nick Mills CPEA, Director, David Burr. firstname.lastname@example.org