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Property market falters with less sales and lower prices
Despite bullish noises from many agents, as we hit the midpoint of the year, the volume of agreed sales is down, and it is definitely turning into a ‘buyers’ market. Correctly priced housing stock is coming to the market and receiving offers in the first two weeks of listing, vendors flying kites are seeing no viewings.
In some ways with property prices having jumped 23% in 24-months, it was inevitable that there would be a slowdown in house sale prices, the biggest question is will the present patchy market turn into a full blown rout, fuelled by ever increasing mortgage rate costs?
Analysis seems to indicate that completions this year will be around 1.15M, down 18% from last year which was an exceptionally high figure, topping the usual 1.2M mark. But there are other factors at play which may see the property market in the doldrums for two or more years.
The most obvious is that the Bank of England are likely to push lending rates to 5.25% by the autumn, which means that fixed rate deals could be hovering around 6.8% for some buyers, and landlords with commercial mortgages are already facing cripplingly high rates, which means some will exit rather than finance property with only a fractional return on profit.
Despite all that the government is stating, inflation will remain high, headline inflation may fall, but the cost of food and the cost of goods and services, until the Ukrainian war and the aftershock of Brexit works its way through means there is not enough money flowing around.
Keychain Unveils Innovative Platform for Mortgage Brokers to Modernise Client Interactions
Keychain is rolling out its cutting-edge digital platform for mortgage brokers and their clients. The platform enhances mortgage transactions by modernising key interactions between brokers and clients, including fact finding, document sharing, and e-signing of client care documents.
Keychain’s platform boasts custom workflows tailored to each transaction type. Over the last 18-months the company has worked closely with a group of brokers to develop the product and refine these workflows, ensuring easy and efficient data collection across all clients, from straightforward first-time buyer cases to more involved portfolio landlord transactions.
The company recently secured backing from the Land Registry as part of the Geovation accelerator programme, which supports firms focused on improving property transactions. The programme features financial support of over £100k and access to Land Registry data. Keychain was founded by Jack Rogers, a former Bank of England economist, and Ivan Sivukha, an experienced software engineer.
Novyy sees Renters (Reform) Bill as a positive for Investors and Landlords
“The Renters (Reform) Bill is a long overdue legislation which will consolidate the business of landlording and encourage serious investors to relook at their long-haul strategy which those who wanted to make a quick buck in property are likely to now shy away. The bill if and when enacted will help institutionalise the Private Rental Sector.” says Ashish Saraff, founder and CEO of Novyy.
It is still early days and industry bodies like NRLA (where we are a member) are engaging with the government to ensure that the final bill is considerate towards landlords as well. The government is looking to review comments from the industry and there is a possibility that some of the covenants will be revised in the final version. It is not yet clear when the Bill will be enacted but whenever that is, it will apply to new tenancies from then and is likely to allow existing tenancies for some amount of cool-off or compliance period.
The government has also committed to introducing the Decent Homes Standard to the private rented sector. However, it is not in this bill and will come separately ‘at the earliest available opportunity’.
The Proptech-X Weekly Roundup in association with Estate Agent Networking.
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.