Apparently, according to many property commentators, it seems the market is in decline due to the referendum result, quietening down and asking prices are dropping – sure signs of an impending crash it appears! My response: January 3rd 1985 (I’ll explain in a moment).
Take a pinch of salt when you read those aforementioned articles!
I was away for the 23rd of June referendum. Yes, I voted by post and no I don’t believe we made the right choice (for different reasons to those you might imagine), but I don’t see the choice we made as such a terrible one either.
Watching the news from afar was an education, not so much on the reality of the situation we found ourselves in but more on how people chose to report and comment and the reason I have such an issue with a lot that is written and discussed is because of the inherent myopia!
Too many people are focussing on the referendum and equating today’s market wholly or in majority to it. What’s wrong with that?
January 3rd 1985.
That was my first day at work and I was told: It’s a great time to start work, the new year is always busy as is just after Easter, ‘July and August are two of the quietest months and only the run up to Christmas is worse’.
It’s July people, the market is in a natural quiet period. It is a pattern I have observed happening almost religiously for the last thirty plus years. Please take a look at the wider picture before making sweeping statements.
I hear that prices are ‘dropping post Brexit’?
Take a look again at what the underlying trend of the market has been throughout the last twelve months. 2015 was a buoyant year for property. By December there was a feeling from buyers that things were going too far. Step into 2016 and before we focussed on Brexit buyers were more cautious. Yes, they would pay a premium for a perfect find but those homes that were only ‘ok’, became harder to sell. Discerning agents were preaching caution to prospective vendors in respect to asking prices. There are always agents who ‘value for favour’ to win instructions and then begin the weekly ‘time to reduce’ calls soon after. Asking prices becoming more realistic is not a sign that prices are falling only that expectations are becoming more sensible.
The Winter/Spring market saw sales, reductions and unsold homes. It was actually a pretty normal and healthy place to be. Not enough people wanted to sell, buyers wanted a home but at the right price and the UK market was kind of self-regulating and calming down.
A discussion I had with a Bank of England representative in early Spring include mention of a slowdown in growth of the UK economy. The BoE could attribute fifty percent of the slowing to the impending referendum but were unsure of the other reasons.
Once again for those doom mongers, things were changing pre referendum; please look at the bigger picture!
What will the future bring?
We are still an integral member of the EU. Article fifty hasn’t been triggered at the time I write this. When it is we will have at least two years. A lot happens in two years and if we are sensible there will be a solution, a counter to each perceived problem. Life goes on and being positive and focussed gets us through all manner of issues. Sterling is low and overseas investors can snap up a London bargain.
What’s the biggest danger to the property market?
Irresponsible reporting and self-fulfilling prophecies. Look back through time and we’ve talked the market up and we’ve talked it down. I know it’s foolish to believe that responsible reporting will prevail but can I ask industry commentators to chase facts and look at the wider picture rather than chase headlines and social media adoration.
Of course the referendum result will have an impact on the property market. The commercial market was hurting even before the 23rd June but how much of an effect it has, well that is down to us to decide in many ways and it won’t necessarily show overnight.
If you plan to buy a home and stay there, to make a life for yourself then it is a good time to buy, but then if you are buying a home it rarely is a bad time to buy because a home is much more than just bricks and mortar, much more than just an investment, home is a feeling and somewhere to stay.
I believe the average person is staying in their home for around twelve years now. A lot happens to property prices in twelve years. Anyone feel confident on making a projection for then?