"Fear is a constant. There's always a great deal of fear attached to selling and buying property"
James Greenwood of Stacks Property Search had this to say: “The main factors that are restricting the market are, in our opinion, and in this order: Fear, Stamp Duty, lack of mortgage availability, the forthcoming General Election, a reluctance to go through the lengthy and expensive process.
Fear is a constant. There's always a great deal of fear attached to selling and buying property. Can I take on more financial responsibility? Might I lose my job? Will property prices go down? Will I make the right decision? Of course big events such as elections and referendums affect fear – they represent the unknown, and assessing risk relies on knowing about external factors.
Stamp Duty – If Stamp Duty reverted to pre-2014 levels, transactions above £1m would double, and this affect would ripple down throughout the market, boosting activity at all price levels.
Lack of mortgage availability – 25% of homeowners can't move because if they were re-certified using new affordability criteria, they wouldn't qualify for a mortgage of the size they currently have. Furthermore, it's estimated that 5% of borrowers have a self-certified mortgage and are now 'mortgage prisoners'.
Forthcoming General Election – Events such as elections and referendums do affect the market, but it's rare that a year goes by without an event such as this, or the promise of one in the near future. There was a General Election in 2015, the Referendum in 2016, and another General Election in 2017. Our view is that these events are more of an excuse not to do something than a significant element of the risk analysis.
General reluctance – Selling and buying is hugely time consuming, expensive and potentially disappointing. At best, moving promises stress and upheaval. Understandably homeowners will seek out reasons not to move.
Having said all this, our clients who have made a move in the last four years are sitting pretty, and are quietly smug. The market has been stable with no volatility to contend with, there has been plenty of opportunity for good negotiation, and prices for carefully selected properties have risen. So our advice to homeowners who have a need and a desire to move is stop blaming Brexit, and to start looking for solutions to difficulties.”
