HIGHER INTEREST RATES WILL BE THE NORM FOR THE MEDIUM TERM
These are comments from the latest episode of The Home Stretch podcast from the Guild of Property professionals.
In the latest episode of the podcast, CEO of The Guild of Property Professionals, Iain McKenzie is joined by Peter Brodnicki, CEO of the Mortgage Advice Bureau, to discuss the topical issue of mortgages rates and how they are impacting the market.
According to Brodnicki, the market has been slowly starting to recovery from the tumultuous fourth quarter of last year, but stubborn inflation continues to see the Bank of England pushing rates up. There is certainly strong underlying demand for property and the market has remained resilient with mortgage brokers still seeing a reasonable level of purchase demand, but as rate rises continue to bite, the market is likely to slow.
“We are now seeing rates start with a six, with another rate rise or two likely, although the larger than expected fall in inflation announced a few days ago is helpful. I think this is something that we will have to get used to for a while until inflation can be brought under control, as whilst it sits over 3% it is difficult to see interest rates falling. When inflation falls, we should see rates decrease fairly quickly, but we should not expect this to happen in the short term,” he adds.
In response, McKenzie says that for those that have been in the sector for some time, transacting in a world where interest rates are high is nothing new. “That said, what is the impact of the very sharp rise in terms of the consumers’ mindset? Are people putting off their decision to buy thinking rates are going to come down at some point and we possibly get back to a zero percent or one percent base rate? Or is this just the new norm and people are accepting it?” he asks.
Brodnicki answers, if you are buying then certainly some will definitely be postponing their decision to do so. It is however a timing issue as you never really lose a housing transaction. “The opposite applies to re-mortgaging or locking in a product transfer, as the urgency to do so has never been greater. Earlier in the year there was some reluctance to commit to a fix rate when there was talk of interest rates peaking, with predictions that they may start to fall within 12 months.
Rates have however continued to rise and now any prospect of rates falling has been pushed back. When rates got to around 4%, five-year fixed rates were popular, but as rates have continue to rise, with talk of more rises to come, then shorter two-year fixed deals are proving more popular. Of course a lot of people are still on fixed-rate mortgages taken out several years ago, and so the government’s plans to curb spending by increasing interest rates doesn’t impact the majority of borrowers in the short term, therefore limiting the impact of rate rises on inflation,” he adds.
McKenzie and Brodnicki go on to discuss several other aspects around mortgages and the market, such as products being pulled at the last minute, the challenges facing consumers and brokers alike, the government’s thinking behind their interest rate strategy, transactional volumes and potential buying patterns we could see unfold in the next few years, the Mortgage Charter and advise to agents.
Last Huckletree curated coworking spaces to open in Liverpool street & Kensignton in further rollout
Press Release July 2023, London: Fresh off the opening of Huckletree Oxford Circus (which is already at 80% occupancy), the leading innovator in curated coworking spaces, Huckletree, has announced it is moving to two of London’s most enviable postcodes: Liverpool Street and Kensington as part of expansion plans, taking their total footprint to over 250,000 sq ft in the UK and Ireland.
Huckletree has achieved remarkable results by carefully selecting a diverse range of innovative companies and providing them with an environment that fosters growth and connectivity. Their unique approach has been key to their incredible success over the past decade. Most recently Huckletree launched a new hub in London’s Oxford Circus dedicated to serving Web3 andAI companies scaling across the capital, and is home to industry leaders and scaling startups including SurrealDB who raised $6M for its database-as-a-service offering in January.
Using ‘The Huckletree effect’ as a blueprint, the company is now expanding its London footprint into sought-after areas including Kensington and Liverpool Street, as it looks to tap into businesses and entrepreneurial communities that are evolving the landscape of these neighbourhoods. For example, Kensington is no longer focused solely on retail and is becoming a cultural hub once again with the opening of the design museum and Japan House, as well as new plans for Kensington Olympia. Alongside the Canary Wharf exodus, Liverpool Street is now set to receive a fresh wave of technology and FinTech firms.
The next two openings are part of Huckletree’s wider expansion plans to launch an additional 140,000 sq ft of space within the next 12 months. They coincide with London being identified as the world’s number one coworking city, out-scoring other global cities such as Lisbon for those looking for flexible working patterns. Huckletree also operates in Manchester and Dublin and is looking to grow footprint in both of these cities also due to increased demand as they grow as thriving locations for innovation and coworking.
Coming this September, Huckletree Liverpool Street will span four floors (35,000 sq ft) of newly refurbished, highly sustainable 199 Bishopsgate building. Looking to attract up to 50 businesses the space will cater for a thriving neighbourhood of FinTech and other innovative players. Hot on the coattails of Liverpool Street, Huckletree Kensington will open its doors in early 2024 and will bring six floors of turnkey, flexible office space to the iconic West London neighbourhood.
Taking over a free-standing building by Kensington High Street tube station, Huckletree aims for their Kensington hub to develop into the epicentre of innovation within the Royal Borough. As a longstanding neighbourhood for creativity, intellectual entertainment and transformative technology, as well as being the home of the capital’s music industry and world-class cultural locations; Kensington is an exciting location for the Huckletree brand. The upcoming hub promises barista coffee and a rooftop lounge bar.
Both spaces are designed for modern styles of working and have a range of state of the art amenities including member lounges, rooftop terraces, dedicated wellness spaces and town hall areas.
Members of all Huckletree spaces have access to tailored programming that includes Huckletre’s ‘Founder Circles’ and workshop sessions with leading experts, as well as a network of venture capital investors. With a growing community of now 75+ global ambassadors, 100+ venture partners, 4000+ members and 1,500+ alumni; the Huckletree ecosystem sets the business apart, and goes beyond being just a physical office space.
Gabriela Hersham, Co-Founder and CEO of Huckletree comments:
“As a company dedicated to supporting business growth and building amazing spaces where people feel happy to come to work, we are incredibly excited by our upcoming expansion into two of London’s most enviable postcodes. This growth will allow us to build an innovation community in Kensington and support the burgeoning fintech ecosystem around Liverpool Street. Our current network of hubs across London, Manchester and Dublin is testament to the infrastructure that we have built since we launched in 2014 – we are looking forward to welcoming more disruptor businesses across London, the world’s innovation capital.”
For more information please visit www.huckletree.com.
Andrew Stanton is the founder and CEO of Proptech-PR, a consultancy for Founders of Proptechs looking to grow and exit, using his influence from decades of industry experience. Separately he is a consultant to some of the biggest names in global real estate, advising on sales and acquisitions, market positioning, and operations. He is also the founder and editor of Proptech-X Proptech & Property News, where his insights, connections and detailed analysis and commentary on proptech and real estate are second to none.