Brexit – Moving on…
It seemed almost impossible this week not to talk about Brexit and the effect on the property market though I’m sure that there’s a lot of people who are already starting to groan when they hear the word given the wall to wall media coverage. If nothing else, it seems as if everyone has an opinion – and one which they ‘re willing to share with anyone who will listen – and that least makes for a refreshing change from the weariness and apathy which had started to suffocate the political scene in many parts of the UK.
What I’ve found interesting is the number of people who have voted leave when on the face of it, it didn’t seem in their own personal interests. For example: dire predictions of what would happen to the property market doesn’t seem to have stopped some property lawyers and estate agents voting to leave and in the days since the result the talk in the market has been about how many transactions have gone off. Was it a case of turkeys voting for Christmas or are all these jitters just a blip and everything will soon settle down?
So obsessed are we as a na on about home ownership and house prices that anything which has the potential to rock the boat always brings out the ‘experts’ with a view one way or the other. Conveyancers generally have been reporting people pulling out of transactions or demanding reductions in price but as always our property market is so fragmented that what is happening in one area isn’t necessarily happening elsewhere. Whilst in the run up to the referendum we saw a slowdown in new instructions, we haven’t seen evidence of a panic to pull out of transactions or indeed to renegotiate the price (or as I heard one commentator call it – brexitundering?! – anything for a sound bite!).
The market was already somewhat distorted following the hike in Stamp Duty Land Tax for second properties on 1 April where people had rushed to complete before the deadline and thus some of the slow down a er March was doubtless partly to do with that. Again – it depends where you are as to how much difference that made. In London where the prices are so high the differences in the stamp duty were huge with the inevitable cooling off. However in the north where prices are so much less, conveyancers there report that it isn’t making that much difference – and in the south west we fall somewhere in the middle of those extremes.
“Whilst in the run up to the referendum we saw a slowdown in new instructions, we haven’t seen evidence of a panic to pull out of transactions or indeed to renegotiate the price.”
Everyone is appealing for calm and the reality is that, irrespective of what is happening in the world at large, our individual circumstances change so that our current home no longer suits our needs and we just have to get on with our lives. The movement in the market is far more likely to come from the more speculative purchases – which takes us back to the second homes and investment properties and certainly the former is a controversial subject in many pockets of the South West – and if those transactions decrease, whether the knock on effect of that is a good thing or not, as with so many things in life, all depends upon where you’re standing.
Just as a postscript to the comment on the additional SDLT payable on second properties – there has been a lot of confusion on when the additional tax is payable – including between solicitors and estate agents – an unfortunate result of the fact that the final criteria for the additional tax was not published until a couple of weeks before the rise came into effect.
There was no doubt that it caught many more transactions than was anticipated with the result that subsequently there was some backtracking – in particular on the question of annexes which feature highly in this part of the country – indeed the government have had to have two bites of the cherry to resolve that particular problem. Similarly there was some confusion on the replacement of main residences and there have been reports very recently in the press of the additional SDLT having been charged when it shouldn’t have been. Anyone who thinks that might have happened should lose no time in asking their conveyancer to check the position. And of course – returning to our Europe theme – your house in France – or indeed anywhere else in the world – does have to be taken into consideration in determining liability for the higher tax over here.
Prior to moving into private practice where she heads up Solicitors Title’s property division, Janet Milton had a long and varied career in local government, mortgage lending and title insurance. As such she is probably the only solicitor in the country to have worked in local authorities, dealing with planning matters as a mortgage lender, a title insurer and as a conveyancer. She has been involved with civil service deliberations on conveyancing reform and has lectured to solicitors on mortgage lending & conveyancing reform. As such she has a deep understanding and knowledge of the housing market.
Janet Milton Partner, Solicitors Title