Two months on from his previous article, Today’s Conveyancer pick ups again with Karl Knipe, Director at Kings Group Estate Agents, to see how things are going.
In his previous article Karl was bullish about the prospects for the property market; a bold prediction at the time but one that seems to be coming true with estate agents and solicitors both reporting a rise in volumes.
Amongst Karl’s prediction were the return of 90% mortgages, and stamp duty holiday and a rise in foreign investment… what else does “Kryptic Karl” have up his sleeve…..?
You talked about being 32% up on last year prior to the crisis.. now that lockdown has eased, where are you against where you expected to be?
About where I thought we’d be, but demand seems to be accelerating on a daily basis. It’s too hard to call I’d say, as we just don’t know where the job situation will land over the next few months.
The big talking point in the industry is how much of the increase is the unblocking of March/April/May pipelines and how much of it is “new business.” How do you see it?
Oh, this is not a debate. New business is swamping the unblocking of pipelines. Particularly since the Chancellors SDLT statement.
What’s your take on the Stamp Duty holiday… good or bad?
Depends on who you are.
If you are wanting to sell or you work in the property industry then great. To be honest it’s a sensible and dare I say it obvious move. The UK lives and dies on the property market activity.
I have a sneaky suspicion that come the Autumn statement we will see a 6-month extension of this. Given the government’s desire to build it’s way out of this I believe early next year you’ll see supply increase coinciding with the end of the stamp duty holiday. Not sensible, desirable or realistic. You’ll get 12-1 on this at Jennings bookmakers at the moment ..lol
What and where has the impact been given that FTB’s were exempt anyway upto £300k and there is still a (reduced) surcharge on BTL?
This has brought the sellers to the market as now they don’t have to find the cash to move on or certainly less cash and if you were thinking buy to let then this has tipped the scales back your way.
How has the surveying business been affected?
This is a whole article by itself… watch this space! But broadly surveying has quite a few issues:
Manpower: we’re moving toward a capacity crisis (see below)!
Structure: There are a lot of employed surveyors all earning c.70k who will unfortunately lose their jobs. Surveying needs some work structurally for all but a handful of companies
Lending: The return of 90% mortgages will be helpful in boosting numbers but the specialist part of the mortgage market is really struggling as they just cannot raise the money to lend.
The property sector has come under fire in recent week for being the “enablers of the Russian state.” Do you see there being an influx of external investment over the next 12-18 months?
This is interesting. I do see a lot of Hong Kong money coming over here. Investments but maybe as a bolt hole in an emergence.
For clarity the government are the enablers of the Russian state. Last time I checked, even though I’m sure I’d be more effective, the government made the laws and ran the country!!
Lazy politics to blame estate agents ….
Next steps…
I spoke last time about the opportunity to change the perception of estate agents.
One of the biggest challenges has always been chains. I believe this will only get worse in the coming months as we enter what will be a challenging jobs retention time; there is a chance the labour market could reflect the early 1980s in the short term.
If there are more than 2 in a transaction, bearing in mind how long transactions can take, then the odds are one of the chain will lose their job, or have to move elsewhere etc, etc.
If the chain breaks in November there is a lot of pressure to find another buyer to ensure completion before 31st March 2021.
I believe that agents must advise sellers that they should be prepared to vacate and break any chain. Buyers also need to be told to be in a position to buy, i.e get their property sold and potentially rent if need be.
If a seller has a choice of buyers then they should be advised to not just go with the highest price but go with the unencumbered buyer, who trumps the chain every day of the week!
