When it comes to getting the full story, on any topic, there is a need to look beyond the headlines. This is definitely the case with the UK property market because there are a number of headlines and big figures out at the moment that would see people worried about their investment and hopes for the future. However, when you look beyond the initial figures, and consider everything that has happened in the UK economy, political realm and property market, things are nowhere as bad as they seem.
The two takeaway elements of a drop in sales figures in the property market and a fall in the number of people obtaining mortgages will inevitably lead people to say that a slowdown is taking place in the UK economy. With respect to the level of residential property transactions in the United Kingdom, this dropped by 22.5% between March and April, according to figures from HMRC. There is also information from Equifax which suggests that the number of mortgage sales in the country fell by 16% over the same time period.
It is important to question property market changes
These figures will inevitably have people questioning the market and whether we are in for tough times but it is important to be aware of factors that shape the property market. In April 2016, major changes were made to stamp duty for people buying an additional property in the UK. This meant that landlords had to pay an additional 3% when buying a property to let, and this significantly increased sales in March 2016 before there was a crash in April 2016. In April 2017, there were more tax changes impacting on landlords and this may have had an impact on the buying decisions made by landlords and property investors. While Nationwide and Halifax have both issued reports saying that property prices fell in April, it is believed that once seasonal issues are considered, the fall in transactions is around the 3.2% level, which is a lot less damaging and concerning than the previously mentioned 22.5%.
In fact, some observers of the market believe that the property market in the United Kingdom is actually holding up quite well. Add in the fact that there is a General Election looming, a factor that always plays a dampening role on the UK property market, and there is no reason to feel despondent, even if the headline figures aren’t too appealing.
When you want to know the full story about the UK property market, or you want to feel as though you are speaking to people who know what they are talking about, make sure you come and see Spencer Harvey. We are always happy to have a chat, so arrange an appointment to see us.