Tag Archives: london
Almost half of UK estate agents think Brexit is having a negative impact
Some 42% of estate agents in the UK believe that the decision to leave the European Union has already had a negative impact on their business, new research has found. One agency even found that following the vote on 23 June some 10% of its sales fell through and valuations were reduced by 40%, according to a survey by software supplier Dezrez. A third of those surveyed predict that there will be between 5% and 20% less properties being put on the market and suggested that home owners may see the value of their house drop by 5 to 15%. But less than believe that property values will fall considerably. The research also found that 52% of estate agents expect vendors or buyers to pull out of sales, or for vendors to take their houses off the market but 53% had seen no affect to date. Indeed, some 37% believe leaving the EU won’t have a long term impact on their business, the remainder are either unsure or anticipate a change in the market and their business model. Few have actually prepared for any kind of Brexit impact. The poll showed that 54% believe it is too early to either have a strategy or indeed need one, while 16% said they have a strategy and 13% are working on one. ‘As the economic landscape continues to shift following the UK’s vote to leave the European Union, the Bank of England Governor Mark Carney has warned prospective buyers to proceed carefully if planning to borrow money,’ said the firm’s chief executive officer Justin Morris. ‘This warning, and the ongoing analysis from property professionals, is unsurprising. However, until the market settles, we won’t know the exact extent the effect Brexit will have on the residential property market. What is clear is that in the short term uncertainty will lead to a dip in market confidence,’ he explained. He added that while opportunist buyers may jump at the chance to renegotiate on price, more prudent buyers will be looking at the affects the turbulent economy is having on their finances, making sure that they will still be able to afford their mortgage. He pointed out that many of the estate agents believe that there are still more buyers than sellers. So, whilst a base reduction in housing stock and value is likely, the market could very well even itself out and remain steady. ‘The role of the estate agent will be increasingly important to vendors and buyers a like. Negotiations may become trickier and sales progression more complex, consumers will rely heavily on traditional estate agents for their experience and advice. There is no doubt that there are challenges and opportunities ahead,’ he concluded. Continue reading
UK property prices record surprise 1.3% rise in June
Property prices in the UK increased by 1.3% in June but the underlying pace of growth is slowing with year on year prices down to 8.4% from 9.2% in May, the lowest since July 2015. This takes the average price to £216,823 and the data from the Halifax house price index also shows that quarterly growth was 1.2%, also down, compared to 1.5% the previous month and the lowest since December 2014. ‘House prices continue to increase, albeit at a slower rate, but this precedes the European Union referendum result, therefore it is far too early to determine any impact since,’ said Martin Ellis, Halifax housing economist. He pointed out that the month on month changes can be erratic and the quarter on quarter change is a more reliable indicator of the underlying trend. The figures show that despite Brexit the UK housing market is fundamentally strong, according to Russell Quirk, chief executive of eMoov. ‘With a continuing, acute shortage of new housing being built and a growing population even if immigration numbers are now curtailed, the demand and supply imbalance and the prospect of even low interest rates will underpin the market,’ he said. David Cheetham, market analyst and FX broker at XTB, pointed out that the month on month rise could be regarded as unexpected following an increase of just 0.6% the previous month. ‘The rise is somewhat surprising considering the impact on house building shares and property funds that has been seen following Britain's decision to leave the EU last month,’ he explained. ‘The worst hit shares in the FTSE100, in both the immediate aftermath and days that followed the Brexit were in the building sector with the majority of observers forecasting the decision to be negative for UK house prices. So far this week numerous asset managers have taken the steps of suspending trading in their property funds as withdrawals have surged amongst jittery investors,’ he pointed out. Sales should start to pick up in the coming months, according to Rob Weaver, director of investments at property crowdfunding platform Property Partner. ‘The fundamentals in the housing market remain unchanged. People still need a roof over their heads. There’s been a stand-off between sellers and buyers with transactions dropping off since the stampede in March to beat the stamp duty deadline. But sales should start to pick up in coming months with the weight of uncertainty now partially lifted,’ he said. ‘While people clearly delayed house purchases in the lead-up to the referendum, that backlog in transactions should unwind through the second half of the year. Life decisions like moving house can’t be put on hold forever. During periods of volatility in the stock and currency markets, investors tend to prefer assets which can provide a reliable income, combined with lower risk to preserve their wealth. For investors, residential property offers both of these attributes,’ he pointed out. ‘Historically, residential property has been the best performing… Continue reading
UK residential tenants out of pocket from unexpected rental costs
Tenants in the UK are being caught out by unexpected costs not covered by their landlord, for example boiler repairs, flood damage, and property maintenance, new research shows. Some 14% are facing unexpected costs of £165.41 per person on average each year with 70% of them not agreeing with the reasons for the charges given by their landlords, the study from insurance providers Endsleigh shows. The study also shows that 47% were not expecting yearly rises in rent, worsened by a high confusion of the possible effects of the recent 3% surcharge on stamp duty. It found that 45% of tenants are unaware of what is their responsibility when it comes to tenancy agreements, driving apart expectations between landlords and tenants across the country. The study also sheds lights on the current relationship between tenants and landlords. Despite possible grievances, some 83% of tenants surveyed said they were happy with their current landlord, while 41% of landlords say they would unreservedly go an extra mile to keep their tenants happy. Unknowingly to tenants, some 28% of landlords say they would absorb the cost of rental increases to keep reliable tenants in their property for a longer period. ‘Although the research could paint a picture of discontent in the worlds of both landlords and tenants, the positives far outweigh the worries. Noticing the number of landlords surveyed willing to go the extra mile for their tenants is reassuring to say the least, highlighting the fact that they are valued, and listened to,’ said David Hadden, head of property at Endsleigh Insurance. ‘Inevitably, costs will continue to be held high on the tenants’ agenda, and though unexpected charges may occur in some cases, hearing that almost a third of landlords will absorb these is very encouraging,’ he added. Continue reading
