London’s property market has a tendency to hog the headlines, and any slowdown in activity sends shivers throughout the whole of the UK. London, however, is not the whole story. While the slowdown caused by a slew of new taxes bites the capital and uncertainty lingers following the Brexit vote, negative sentiment hasn’t seeped into every corner of the country.
“Whilst there was concern about the repercussions of the Referendum on the economy, the market in the North has settled down and there is still positive sentiment post Brexit,” James Mohammed, from Allsop’s Leeds office.
“Immediately following the Brexit decision in June, as expected, both local, regional and national housebuilders appeared cautious whilst they assessed their position and the impact of the decision on the housing market, particularly with regards to land acquisitions and the timing of bringing new homes to the market.
“Following this brief period of uncertainty, we are yet to see any significant impacts on the land market from a transactional perspective, with the larger regional and national housebuilders continuing to show a hunger for acquiring land.
“The smaller local and regional housebuilders are still wary of over committing themselves on land acquisitions, as they were pre-Brexit, and remain nervous with regards housing sales, with some delaying bringing new schemes to the market whilst they continue to assess the market. With the continuing supply of development land being brought to the market, in part due to the Councils requirement to service their five year housing supply, we remain optimistic the land market will remain stable.”
According to Paul Mahoney, Managing Director of Nova Financial, investors are increasingly looking outside London. “Most of our clients both from the UK and overseas are investing outside of London at the moment and there has been a noted shift in focus toward Manchester and Liverpool,” he said. “A recent RICS report identified that demand has dropped post-Brexit in all areas of the UK aside from the North West.
“We put this down to these cities undergoing major infrastructure spending as well as population and employment growth far beyond what they’ve experienced before. They offer yields circa double that of London and much more affordable property in central locations. With London at the top of the property cycle, in our opinion, and the North West still below the 2007 peaks, we see a lot of value in that region.”
According to Mike Banton, Managing Director at Artez Ltd, after pausing for breath immediately after the UK referendum result, the North of England quickly resumed progress.
“We’re aware of reports from the south of the country that suggest there has been a downturn in the property sector but this certainly isn’t the case in the north, in our experience,” said Banton. “Some projects are reliant on foreign investors, so naturally there was uncertainty about how the vote would affect the schemes. However, the projects are continuing as planned and many are selling out before completion of the construction phase.
“Our order book is stronger than ever and our financial forecast is looking very healthy. We are of course conscious that there could eventually be a knock-on effect, but for now it seems to be business as usual.”
PICTURE CREDIT: THOMAS NUGENT