Summer Time

We live in curious times and there is only one topic of conversation whenever two or three of us are gathered together.

It is now two weeks since the result of the referendum. Over this period the numbers of people registering to buy and to sell herein the West End  has drifted off. However, the calibre of these buyers and sellers is high as they are pre-disposed to act in the current market.

The Central London Property Market is much more involved with overseas and investment buyers who will tend to hold off until the direction is more clear.

The lower currency will help in time, but maybe not just yet. Such pure currency players will also want a price discount.

Official interest rates are at record lows and set to head lower. The Bank of England is introducing measures to release further lending.

I think the underlying worry is not so much what will happen next, but what will happen next after what happens next.

We have seen some re-negotiation of deals as buyers have sought to justify re-pricing. The majority of these  deals have been re-agreed.

My feeling is that we will not be able to judge the state of the market properly until at least the end of July, by which time we will all have had further time to evaluate reactions to the vote with greater perspective.

In this low interest rate environment demand should  return and that there is therefore no reason for sellers to take an untoward hit on prices. I have seen no indication of forced sales. As supply tightens, buyers risk facing a reduced choice.

In the wider market, the lack of supply is likely to tighten further as developers hold off on projects. Approximately 200,000 new homes per annum are needed to meet excess demand nationally, but since 2007 new builds peaked at only 156,000 units in 2015. In London 50,000 new homes are needed each year, but again a peak level of only 23,000 new homes has been achieved since 2009. These numbers may worsen in the short term.

We should see  improved activity over time  in the sales market as people get on with their lives.

I am pretty sure we will have a better picture in about a month and it may all be fine, just a little different.