May Property Market Update

12th May 2017  |  12:00am

May Property Market Update

The sales market at the moment is in an interesting state as it is characterised by an overall shortage of supply, yet remains price sensitive. Property is selling but ambitious pricing can kill activity and the chances of a sale. The rental market has a little more availability on the supply side and, with a number of tenants now taking advantage of an improvement of affordability, is again price sensitive with tenants exercising greater degrees of discretion before committing.

The likely market picture over the coming weeks is one of subdued activity. A number of planned Government "initiatives" affecting the property market and the wider economy are now "on ice" and may not materialise as quickly, or at all, once a new Government is returned because of the pressures of negotiating our exit from the EU.

Politicians of all sides however are keen to ensure that the general strength of the U.K. economy continues. Whilst there are some growing inflationary pressures in the economy, this is against an extremely low interest rate environment and means that thoughts of imminent rises in mortgage rates have receded.

With overall wage increases running ahead of inflation, affordability has improved and there have been many reports indicating an increase in the number of first time buyers buying and taking advantage of low mortgage rates. The banks of mum and dad and nanny and granddad are assisting with the provision of deposits, often releasing equity from their existing homes.

Our view is that the market remains sound both in the immediate and longer term. A period of price stability is inevitable and welcome but longer term growth is also certain as, despite increases in housebuilding numbers, there remains a higher level of underlying demand to supply.

As always, our team will be pleased to discuss your individual situation and advise on the best options available to you.