With our first interest rate rise in 10 years today, Mark Carney commented “With unemployment at a 42-year low, inflation above target and growth just above its new, lower speed limit, the time has come to ease our foot off the accelerator”. It was very refreshing to hear the positive news. The economy is on the move with 1.5% growth over the year, especially considering the impact of the weakening pound. The increase was anticipated and further rises are expected at a gradual pace and to a limited extent.
The consequences of continued uncertainty over Brexit will unfold in their own time. This uncertainty will impact both the economy and individual’s finances, which may make buyers more cautious in the short term.
The continued pressure on buy-to-let investors will become more apparent as the tax relief they have lost now begins to bite, along with the additional 3% stamp duty paid on purchases of non-primary residences. This can only be a good thing for first time buyers who will have less competition in the market place. However, investors are continuing to purchase, because property remains a sound and tangible investment, especially in the affluent Cotswolds.
The government has announced a call for evidence in preparation for a review of the house buying and selling process. In a world that is speeding up through technology, house transaction times are slowing down. This can be off-putting to buyers, in particular to our first time buying millennials who have grown up in a rapidly evolving high pace world. They want a process that allows them spontaneity, speed and assurance without all the uncertainty. I expect and hope to see growth in public auctions, they are a fast, exciting, transparent and conclusive.
Fortunately, there is a silver lining to this current cloud. This market is primarily made up of motivated buyers and sellers. These are people who have to move for a variety of life decisions rather than purely aspirational ones. And there is never a better time to be in the market than when everyone is motivated to make things happen.
For property related advise please don’t hesitate to contact Tom or the award-winning Hayman-Joyce team on 01608 491081 or email@example.com.