Adam’s Market Insights: At least it wasn’t bad news… or was it?

23rd November 2023

 As this week’s Autumn statement from Mr Hunt claimed to contain 100 measures to improve the economic weather, there had been much anticipation moves which could revitalise the property market. However, whilst there were a number of announcements relating to UK property made by the Chancellor, many of the items on the top of the Christmas list for buyers and sellers were missed.

Announcements relating to property included a rise in Local Housing Allowance Rates, Changes to the planning process, and an extension to the Mortgage guarantee scheme. All good. For a full run down on these items, you can review Coapt’s Autumn statement summary article here. These measures fall a long way short of much of the speculation surrounding the announcement in the preceding days, which suggested a permanent cut to stamp duty and new Inheritance tax relief. Items which each would have seen a boost to market activity.  Unfortunately in the current climate, no action, in itself, is detrimental, and even when there is good news, it can be negatively perceived.

Market chasing has sadly never been more prevalent. In recent years I have noticed a large increase in questions relating to the “right time” to buy or sell. Which on the surface is of course understandable and sounds sensible, but to me indicates an increased reliance on market commentary and speculation.

As an example, mortgage rates have been dropping consistently for a couple of months now, not that the media will tell you about it, but even this good news has meant a SLOW down in buying activity. All the while rates are reducing, and there is seemingly no imminent threat of house prices increasing, why rush to buy when you can hang on for a better deal. This has also affected conveyancing time scales, as some buyers are changing mortgage products multiple times throughout a transaction, as brokers source ever improving rates. Again, it’s all understandable, but highlights how an improvement, or forecasted improvement, in market conditions can be detrimental! – It’s all rather akin to tying a carrot on a string to the front of a Pig.

In my mind this Autumn statement has that exact same oxymoronic effect. The expected reliefs for the housing market, especially in tax, which were not announced yesterday are now instead already being spoken of for next Spring’s full budget. So once again the consumer could be expected to further delay buying and selling plans, as there is hope on the horizon for better conditions. The failure by the chancellor to make decisive changes relating to property sales is more than just the lack of a positive, but in itself is damaging. It all could be a tactical move to bring in the flag ship announcements in the Spring, closer to the next election so they are fresh in the mind. Alternatively it could be giving too much credit to improved inflation numbers and rates reductions, “If things are on the mend already, why risk volatility?” Or perhaps only 12 months on from Liz Truss, and a high percentage of BOE members then needing a Pace Maker fitted in the aftermath, is there an apprehension to induce anything too meaningful in Autumn statements?

In all, perhaps I have grown even more pessimistic, but this Autumn statement feels more than just an opportunity missed for improvement in our sector, but instead a knife in the back after a naive expectation for recognition and proactivity.

As always, if you have any questions or thoughts in relation to the buying and selling of either residential or investment property, please do get in touch.

Adam Coffin MSci, MNAEA, MARLA
Senior Sales Consultant
adam.c@coapt.co.uk
01273 645797 Extension: 2020