Falmouth property price rises set to be more restrained in 2017 due to Brexit

 

 

Brexit has not yet had a sizeable impact on the Falmouth housing market. The battle lines for our exit are yet to be drawn and therefore the uncertainty has meant that the market appears to be plodding along. We feel the tone has been set for the year and that the Falmouth property market is likely to remain subdued for the foreseeable.... 

 

This isn't a bad thing. Since last Summer, apart from a little wobble of uncertainty a few weeks after the Referendum, property values and the economy has outperformed what most people were anticipating. In fact, when I looked at the property prices for Cornwall these were the results...

 

October 2016              - rise of 1.12%

September 2016         - rise of 0.28%

August 2016                - rise of 1.24%

July 2016                     - rise of 1.59%

June 2016                    - drop of 2.56%

 

Looking beyond the Falmouth 'bubble', the UK wide property market continues to perform robustly  with annual price growth set to end this year at 6.91% and most South West region property market at 7.18%. Indeed talking to fellow agents, the significant tidal wave of growth seen from 2013 through to 2015 in London and the South East is still rippling out to the provinces. So, fellow Falmouth landlords and homeowners, it may be surfboard time for a little while yet?

 

The property market locally is more driven by sentiment, especially the ‘C’ word ... confidence. The main forces for a weaker Falmouth Property market relate to economic uncertainty surrounding the Brexit process. Prices are still holding up because there is a short supply of housing. You can always tell this, since estate agents seem to be spending just as much time peddling their literature on how great they are and how they are in need of more property. I don't know about you but the volume is on a par with the pizza vouchers! 

The reforms to taxation will focus landlords attention on their profit margins. They may also naturally 'check' demand for more buy to lets. Likewise student landlords appetite for buying student buy to lets will be curbed by the need to show a history of HMO usage in Falmouth before June 15th.

 

On the flip side, demand from tenants remains strong. In our opinion, rents are stable and in many cases edging up.

The big question for all agents and landlords is the likely ban on tenant fees and what impact that might have for both of us. This is encompassed in the Bill of Rights for Tenants, the details of which are being discussed by the Government over the next six months. More on this another time. Suffice to say if this goes through, we predict that towards the end of 2018 rents will rise more significantly than they have for a generation.