“In limbo, slowing down, genuine concerns.” No, not extracts from my old school reports – surveyors’ views on the state of the housing market.
The quotes, from the Royal Institution of Chartered Surveyors’ latest sentiment survey, make grim reading. House prices, new buyer enquiries, new vendor instructions, agreed sales – all down. It is a similar story from UK Finance, where all mortgaging and remortgaging figures have fallen quite considerably year-on-year.
Surveyors and lenders alike say this is almost all due to uncertainty about the outcome of Brexit, leading buyers and sellers to take a ‘wait and see’ approach. So, with Brexit now delayed for three months beyond the October 31 deadline, what does that mean for the UK property market and the professionals who rely on it?
The usual disclosures apply here. Caveat number one: this is far from being a country-wide issue. While the London and South East markets stagnate, other parts of the UK, such as East Anglia, areas of the North and Northern Ireland, are flourishing.
But one thing all parties can agree on is, regardless of how well or not the property market is going in their area, it will be going a whole lot better once a Brexit deal, or no-deal, is confirmed.
Caveat number two: It’s impossible to predict the future with accuracy. If you knew the answer you wouldn’t be reading this, if buyers and sellers knew I wouldn’t have anything to write about and if I knew for sure I’d have said it by now.
Caveats duly dispensed with, there are some interesting avenues the market might go down as a result of this extension that are worth pondering on.
Firstly, three months is a long time. An optimistic person might not be surprised to see a small increase in buying and selling, on the basis that many vendors and purchases will feel they’ve hung on long enough, and three months is long enough to get a mortgage over the line.
Another, perhaps more likely, option is that the current stagnation and negativity around buying and selling homes continues. The twists and turns of the Brexit negotiations are so arcane that it is almost impossible to keep up.
I say that even as a journalist whose job gives him the luxury of being able to read the news for much of the day. I can only imagine what it’s like for people with proper jobs. Another three months of the same old frustrating Brexit back-and-forth could well see market torpor continue.
Another optimistic take is that, for all the negativity, the market has not ground to a halt. There will always be a need for the nation to buy and sell homes, it is currently just a question of how strong that need is for many and whether it outweighs negative sentiment.
Looking to the future, surveyors are much more optimistic about the health of the market in 12 months’ time. Mortgage brokers have always been made of sterner stuff than surveyors and are also upbeat about the future.
Let us hope that clarity cuts through the chronically opaque Brexit situation soon, and that the aforementioned optimism is not sorely tested.