I was interested to read research from consumer group Home Owners Alliance which advises that more than a million UK adults have shelved plans to purchase a new home because of the vote to leave the EU, economic uncertainty, mortgage restrictions and high house prices. I also think that the possibility of Indy2 is having an impact in Scotland as are the changes last year to LBTT. I will give you my March report as soon as I have further stats.
The spring market would appear to have started early this year with the number of new properties coming to the market and viewing figures both up considerably compared to 2016 statistics. It’s still a great time to buy with interest rates held at an all-time low and banks offering finance with as little as a 5% deposit. We also have a stable market in Perthshire with no dramatic price swings in recent years with many properties selling for around Home Report valuation.
10 Reasons to use Blackadders to deal with your Estate Agency and Conveyancing:
- Estate Agency and legal teams all under the one roof
- Members of Scotland’s Solicitors Property Centres giving your property maximum exposure
- Efficient and cost effective – one firm dealing with the entire transaction
- Lawyers on hand to answer any technical questions from interested parties regarding title deeds
- Experienced negotiators helping to obtain the best price for your property
- Offices throughout Scotland with local property teams who have local property market knowledge
- Up-to-date buyers’ database
- Full service firm including advice on asset protection, wills, divorce and family law, wealth management plus access to residential and commercial finance
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Property Valuer – Perth
I was very interested to read an article in The Times on Saturday 7 January 2017 regarding proposals from the UK Government to give tax breaks for a new generation of prefabricated home manufacturers. This is part of a package to reinvigorate Britain’s failing housing market and to ensure that the government hits its target of building a million new houses in the next five years. I do think that this is a welcomed proposal as there have been some significant improvements and innovations in the house building process recently and house builders of all sizes should be encouraged through tax breaks to investigate and take advantage of these new techniques.
This article in The Times coincided with a very interesting article I was reading by Graham Norwood in which he led the call for more direct housing i.e. council house/housing association properties, making the point over the last few years successive governments of varying political hues have failed to inspire the house builders to increase the amount of properties that are being built. I am a great believer and in fact think that it is of fundamental importance to society that people have the opportunity to live in quality housing. The scourge of homelessness and dilapidated properties is one that desperately needs to be tackled.
I feel that it is important that for both political and economic reasons that our society is underpinned by home ownership. I have detailed in previous blogs the assistance that I think requires to be given to first time buyers and I would wholeheartedly support any incentives to help builders increase the amount of properties that are being built but I do also think that there should be a controlled increase in the amount of social housing being built. I very much liked Graham Norwood’s suggestion of “community housing” although it is interesting that as part of his article he does state that he would much prefer to live in a privately owned property than one that is either council or community owned. For this reason I would advocate a return to some form of controlled right to buy with strict rules and guidelines in relation to properties being built and, for every property sold under right to buy, a certain number would be required to be built to replace them. I think that some form of right to buy or shared equity scheme could be used to assist people to actually get on the housing ladder and might be a means of controlling house prices. I will explore this theme further over the weeks to come.
I was very interested to read an article by Professor Stewart Brymer on the future of property factoring. This is something that I think is very important for improving the quality of flat dwellers lives in relation to less stress regarding common repairs and also the maintenance of common parts such as roof stairwell etc. This would also go a long way to assist in relation to the maintenance and improvement of the tenemental housing stock. I think there is scope for the Scottish Government to legislate and to formalise factoring and I think that local authorities should consider making factoring compulsory where a property owner has applied for a grant or perhaps where a block contains an HMO. I also think lenders and surveyors should also encourage owners of flatted/tenemental properties to be involved in a factoring scheme as it would surely protect and enhance the value of the asset. This would be a low cost way for the Scottish Government to assist in relation to the maintenance of the housing stock and also go a long way to improving the quality of life of flat owners.
Firstly, apologies to the loyal band of readers who have not had a blog since June 2016. This is perhaps a sign of me trying to comprehend a very unusual set of circumstances, also coupled with an increase in activity amongst my client bank. Rest assured, there will be more regular blogs from now on. Before I give you my predictions for 2017, how did I get on in 2016? Well, as I have said before, 2016 proved the most unusual of years for the property market. My catchphrase for 2016 was “cautiously optimistic” with a concern regarding various changes including the LBTT and additional dwelling supplement, the Scottish Government election in 2016 and also the impact of a vote on Brexit. Whilst I am still awaiting the final figures for the Scottish-wide property market for 2016, my feeling is that they will show a contraction in the number of properties coming on to the market of an average of between 6% and 9%. This is a considerable contraction and one which is showing in relation to the spike in house prices in certain areas. I would refer you to a previous blog “Stagnation Not Bubbles”. The change to LBTT and the introduction of the additional dwelling supplement has had a catastrophic effect on the housing market. Once again 2016 showed the Aberdeen market continue to reflect the low oil price but Edinburgh and Glasgow also showed signs of a slight slowdown which was also reflected in the Dundee market. Again, I await data from the Council of Mortgage Lenders to confirm this feeling.
In summary, instead of the second half take-off as I was expecting from August, 2016 continued to stutter along with the property market at best plateauing and at worst showing serious contractions in certain areas.
So what of 2017? Unlike the last couple of years, I would say that I am slightly more negative and am probably best described as cautious, losing the word “optimistic”. I think that 2017 will be unchartered territory as the impact of Brexit, be it soft or hard, starts affecting people’s buying power. The continued uncertainty of Indy 2, the negative impact of the additional dwelling supplement and Scottish Government policies that in general seem to be anti-home ownership but are certainly anti-property investor, will all have an impact. I think that we will continue to see low interest rates and good mortgage deals and I suspect there will be a further contraction in relation to the size of the market, but possibly not as large as some commentators are predicting. I have seen contraction predictions in excess of 10%.
In relation to the property market, my wish for 2017 would include increased assistance for first-time buyers at the lower end of the price bracket, a review of the LBTT bandings and the removal of the additional dwelling supplement. These are very similar to last year and each deserve a blog in their own right. Sharp-eyed readers will note that I have dropped my call for the removal of the Home Report but this by no means signifies an acceptance, rather more a “what’s the point of calling on deaf ears”.
In summary, I am predicting a 5% decrease in market activity with a slight increase in house prices averaging around the 2% to 4% mark. Again, the figures I would urge readers to look at are the number of properties coming on the market in Quarter 1.
I wish all readers a Happy New Year and I will continue to keep you advised of trends in the property market.
I was very interested to read Kezia Dugdale’s proposals in support of first time buyers. Whilst I do not think the plan goes far enough, I think it is very positive that we have a party that appears to recognise the aspirational nature of home ownership and the importance of first time buyers to the housing market and the wider economy. Not only does a stable housing market assist the economy, my view is that it also benefits society as a whole as people also have a financial stake in their communities as well as a moral one.
I would urge all parties to look at more ways of supporting first time buyers and also schemes to increase the amount of house being built.
Partner – Head of Property
In the last few years estate agents and conveyancers have been challenged to provide the best possible service at the best possible price. To step up to this challenge we have embraced the use of the latest technologies and techniques available. In 2009 we launched our new website and property system, complete with a client interaction area. This secure login area allows our clients to track the progress of their property sale at a time that is convenient for them. When anything significant happens, such as a viewer booking an appointment, the system automatically sends an update to the client and it is recorded in the system. Any comments we receive back from that viewer are posted on to the system. The client can either choose to receive a feedback call from us or they can login to the system and check for updates at a time that suits them. The system also allows prospective buyers to enter their property criteria and as soon we have a property match it will send out the property details to that prospective buyer automatically.
Our commitment to be at the cutting edge of the legal and property sectors means that we are always looking at new innovations to maintain that position. Following the positive feedback we received after the launch of our website and our commendation award at the DADI (Drum Awards for Digital Industries), it seemed like a natural progression to design an App that would allow those looking for a new home to search our entire portfolio of property for sale and allow our clients to access the client interaction area while on the move.
Although the Scottish property market is showing small signs of improvement we still need to ensure that our clients’ properties are seen by as many people as possible. We hope that by giving people access to our property portfolio through many different sources and allowing clients to access information at the touch of a screen, it will speed up the sale of property and improve the market further.
The key consideration when we were designing the iPhone App was to ensure that the interface was simple to use and that there was synergy between the App, our property system and our website. We worked with local digital firm Avian on the project for several months and have produced an iPhone App that not only looks fantastic but is user-friendly and has some great functionality. The Blackadders App allows you to search by location, property type and price; view full property details with images, descriptions, floor plans and maps; book a viewing and even submit a Note of Interest. In a tough economic climate we believe it’s important that we stay ahead of the game and continue to develop and use the technologies that are out there to try to make the process of buying and selling a home less complicated and less stressful.
Let us know what you think – download the FREE Blackadders iPhone App from the iPhone App Store. Search for ‘Blackadders’ to download.
Head of Property Services