Partners from the Commercial, Residential Sales and Lettings teams at PAI member Fenn Wright share their property market predictions following the surprise snap election.
The British property market barely had chance to catch its breath following the Brexit vote, before Theresa May called a snap election and subsequently lost her majority in the Commons.
Latest data from the Royal Institution of Chartered Surveyors (RICS) suggests that both Brexit and the election have had an impact on the property market. This impact has been felt in East Anglia, with Fenn Wright seeing a slow, but visible, shift in market patterns since 8th June.
Alan Williams, managing partner at Fenn Wright, said: “At Fenn Wright we are handling high volumes of property coming on to the market this summer, but there appears to be a little more price sensitivity in the market.
“Not everything is selling quickly right now as some buyers are playing a waiting game and are prepared to take more time looking at an improved stock of available properties.”
However, he added, it is hard to determine at this stage whether this slow-down is seasonal or long term.
“Our view is that some price stability in the market would be welcome for many, especially first time buyers. It wouldn’t be unexpected given the ongoing political situation, but we also have to bear in mind that the holiday season traditionally dampens down market activity anyway.
“We expect a resurgence of demand from September to November but if it fails to materialise then it might confirm a change of mood from a straight sellers’ market to a more neutral / buyers’ market.”
The outcome of the election has also resulted in a more measured approach being taken within the commercial property market.
According to Fenn Wright’s Alistair Mitchell, a partner in the commercial division, the political and economic uncertainty caused by the hung parliament coupled with Brexit has resulted in some Essex and Suffolk based occupiers, investors and developers deferring important strategic decisions until the future becomes a bit clearer.
However, he remains confident in the resilience of the market. “Bank funding for property acquisition, investment and development remains available at low interest rates, which together with a lack of supply in a number of sectors will ensure values are maintained. The low value of sterling will also continue to attract foreign investment in some of the more significant development and infrastructure projects,” concluded Alistair. “Ultimately the fortunes for the commercial property market in Essex and Suffolk look positive.”
Joseph Hall, head of business development, lettings, is hopeful the new housing minister, Alok Sharma, will get to grips with the key issues affecting the housing market and, in particular, review stamp duty.
He said: “Many of our landlords are looking to expand their existing portfolios and a reduction in the stamp duty surcharge will give these landlords even further appetite to invest.
“We need to see an increase in the supply of properties coming on to the market and one way to achieve this would be via a review of stamp duty which none of the main parties committed to before the election.”