How the property market will be impacted by Jeremy Hunt’s Budget

Article provided to FSE Media by MFS (Market Financial Solutions)

But, if we can just push through the next few years, we could end up in a much more stable position.

We’ve got some changes on the horizon. Changes that may affect property investors whether they like it not. Capital gains tax (CGT) allowances will be cut over the next couple of years. As a result, we could see property holders rush to sell their assets before the new rules come into play.

This may not be much of an issue though. Mr Hunt also announced stamp duty cuts will be phased out from 2025. Buyers may be keen to meet rushed sellers in the middle. Both sides of the market will be incentivised to move in the coming months and years.

There were, of course, many other announcements made to try and balance the books. It remains to be seen if the measures work. But, despite the pressures we’re all facing, the outlook for property looks promising. The elements that have pulled prices down as of late may start to ease sooner rather than later.

Inflation is expected to drop from the middle of 2023, while interest rates could max out around the 5%-mark next year. These are predictions, but the point remains. We’re collectively trying to pull ourselves out of our troubles. At a certain point, these efforts should pay off.

This leaves property investors with a relatively short window of opportunity. Average house prices could fall over the coming months, but property is rarely available at a discount. In fact, prices are set to rebound in 2025 and continue upwards from there.

A bottleneck may emerge. Money could flow into the market as buyers attempt to take advantage of reduced prices, looming legislative changes, and sellers desperate to unload their stock. Indeed, just over half of all property investors plan to invest in 2023, according to Finbri. This rises to 68% for experienced investors with over 5 investment properties. There’s still plenty of confidence to be found.

Participants are set to fact rampant competition over the next couple of years. As property investors attempt to manoeuvre through the oncoming chaos, specialist finance will prove to be an essential element of the lending landscape.

We’ve already seen how high street lenders have struggled to keep up in recent months. It’s unclear if they’ll be able to handle anymore pressure. But specialist lenders are designed with complexity in mind. We can handle claims from those turned away by the high street due to having adverse credit, CCJs on their records, or no UK footprint at all.

We can also move as quickly as the market demands. We can have funding issued in as little 3 days, allowing investors to lock in a deal before it’s too late. No matter how, or when housing turns, we’ll be there to provide support.