Right now the Government is discovering what it’s like to have a variable rate mortgage. The cost of their borrowing recently hit a 16-year high, which, given their usual appetite for borrowed money, must hurt.
If ever we needed a sudden burst of economic growth, it’s now. Without it, we could be staring down the barrel of service cuts or, worse, another round of tax hikes.
It’s a volatile time. The markets have been lurching, investors are nervous, and the value of many investments has taken a sharp nosedive.
Yet, oddly, property has remained almost impervious to the wild swings of the currency and equity markets. It hasn’t experienced the dramatic gains or sudden plummets that were widely predicted.
Now is a volatile time for the property market, according to an expert
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Sales volumes remain low, and that’s why prices are still stubbornly high. We’ve reached that strange moment as a nation, where it feels like we’re at an ‘all pain, no gain’ stage.
There have been painful cuts to services, employers are about to get hit with National Insurance hikes, and yet… there’s nothing to show for it.
So what can we expect from the market before Easter? There are five key things I believe we’ll see.
Property predictions
- It’s going to get busier as we approach the Stamp Duty Land Tax (SDLT) deadline. Enjoy it. April to September is likely to be a struggle.
- Landlords are already selling up to beat the deadline, which will shrink the rental stock even further. Expect rents to rise, though at a slower pace than last year.
- If you’re employed in the property sector, brace yourself to do more work. Employers will be grappling with increased National Insurance and rising minimum wage costs, so they’re likely to resist the temptation to hire new staff for a while. It’s going to be all hands to the pumps.
- Bank of England rates will likely fall – just a quarter-point, but don’t get too excited. It’s going to be a slower decline, not the rapid cuts many were hoping for.
- As the weather improves, the Government will hopefully begin to show some signs of life. Perhaps, just perhaps, the larger infrastructure projects we’ve been promised will begin to materialise. Slowly yes, but there might be a faint hint of optimism—a “feel-better” factor, even if it’s not quite the feel-good one we’ve been waiting for.
