As we planned this month’s market update we were expecting to be making mention of the UK’s exit from the European Union and looking forward to signs of stability returning to the market.
However, as we sit here today (towards the end of March) we are seemingly no nearer to a conclusion with the Prime Minister’s deal, no deal, a people’s vote or even a General Election being touted as options.
What ever your view as to whether we should remain in the EU or leave or, if leaving, on what basis, there cannot be many people in the country who are happy with the endless political indecision and shenanigans and the need for a clear decision is now crucial to allow everyone to plan and move forward.
The sales market is undoubtedly stuttering currently with a growing number of people sitting on their hands and not committing to a sale or purchase.
Transactional volumes have fallen but there is a growing volume of pent up demand awaiting to be released.
Of course, alongside those who are exercising their discretion at the moment, there are many who have to move and the underlying factors remain strong for the sales market – low interest rates, a growing population, high levels of employment and wages moving ahead of inflation. Whilst a real sense of general urgency is currently missing, we expect this to change as soon at the Brexit position becomes clearer.
By comparison the lettings market remains quite strong with a good balance between supply and demand and both landlords and tenants looking to commit.
The ban on tenant fees will come into effect in June and may have some upward impact on rents as landlords look to recoup the higher costs they will be incurring. This will, of course, be tempered by affordability and supply and demand factors. Many see renting as a tenure of choice, as it provides greater flexibility than home ownership and so demand is likely to remain strong.
With over a quarter of 2019 now behind us, Spring having officially begun and the days getting longer, we are moving into the traditionally stronger months of the year for activity in the market. The year may have got off to a fragmented start but could see a significant surge of activity as soon as the certainty of our Brexit position emerges.
Darren Murphy and Chris Harper