I reported the week after the EU Referendum that from our data the property market in north Leeds didn’t seem to have been affected by the result, despite the pound crashing and the stock market plummeting as the press had forecast. Interestingly, the pound didn’t hit parity with the Euro as many had speculated and the stock market picked up fairly rapidly after its initial shock. One month on the Euro still remains below 1.20 but the FTSE 100 is back to 2015 levels of 6,700+ whilst the FTSE 250 remains below 2015 levels but well up on 2014 when we all felt a sense of well-being. I suspect the rather dramatic changes on the political front have affected global market confidence and only our relationships with EU countries are undermining the Euro exchange rate.

On our own business front sales has hardly seen a blip. We’ve had a couple of ‘cold feet’ where buyers have pulled out of deals, but statistically these are no more than we see on a monthly basis where buyers occasionally change their mind, lose their jobs, personal circumstances change etc. Our viewing figures for last week (Week 27) were the same as Week 27 in 2015 with 47 viewings undertaken, both being up 23% on 2014. We’re still taking offer and still agreeing deals.

New sales instructions have actually increased in the last Quarter compared to 2015 although there still remains an overall shortage of supply compared to the level of buyer demand. Families are still keen to buy good sized semis and detached houses, especially properties with generous gardens. Enquiries for Buy-to-Let property appears to be remaining constant, the only reticence seemingly over concerns regarding the tax changes coming into play in 2017. These changes are unlikely to suppress demand as investors will simply re-adjust their yield expectations to reflect the tax implications.

I believe we’re already seeing younger landlords switching personal ownership of Buy-to-Lets into limited companies to achieve tax efficiency. Despite an initial cost to transfer existing personally-owned property into a company landlords are conscious that Buy-to-Let investment is a long term plan (often 30+ years) and the tax benefits of owning property in a company will soon repay the initial capital outlay. The more established landlords and those approaching retirement face a significant capital gains tax bill to effect such changes, which may make a restructure financially unviable.

On the rental side demand for furnished property continues to rise with yet more upward pressure on rents, especially for smaller, more affordable, accommodation where demand is strongest. I suspect there are some tenants or first time buyers who were thinking of buying, but with some anxiety about how Brexit may affect their particular industry or employment, have turned back to the rental market. With a lack of new rental stock coming to market, demand will drive rents upwards throughout 2016. The rise in rents will potentially help landlords offset the new tax charges by offering better yields.

My opinion of the future of the property market in Leeds remains as it has for the last year or so. We have a very limited supply of property with an increasing demand. Property prices can only go in one direction unless an external force impacts on the supply, or demand, or both. There is little sign of a sudden increase in property stock as there is (relatively) little new-build under construction. There’s every chance of a fall in interest rates, which could make buying property even more affordable. In addition, lower interest rates on savings accounts will simply stimulate the Buy-to-Let market as savers seek to achieve a decent return.

I appreciate Brexit may see our national GDP ease back but that didn’t affect the property market in the recession, which was only hog-tied by lack of finance. Hence, I can’t see a slight easing back of our economy affecting the property market in Leeds this time around. If a full-blown recession does occur and unemployment increases there will be yet more pressure on interest rates and a stimulus will be provided by Government with more Quantitative Easing – we’re already being ‘prepared’ by Mark Carney for this in August (although my suspicion is it won’t be necessary – again!). I personally cannot see, at the moment, what factors are going to upset the property market in north Leeds.