I thought, over this Bank Holiday weekend since its raining, I would 'pen' a few thoughts & predictions on the more immediate effects the new Government have had & may have on the property market in the short term. Though having tried, almost constantly, to predict the market over the past three years the only sure thing is predicting is not easy

HOME INFORMATION PACKS

On the day prior to writing his I attended a market appraisal of a two bedroom apartment on the south edge of Oxford City at 2pm, & by 4pm the same day, the property was on the market appearing on ‘rightmove’ etc.  It’s been a long while since us Estate Agents have been able to do that & something I think we all welcome the return of being able to do. Why? Home Information Packs have been suspended (hurrah) & hopefully banished forever. The process of ordering &waiting for a HIP to be completed before commencement of marketing has certainly been a thorn in the side of most agents, a barrier to many vendors wanting to market their property, & not to mention a waste of the upfront amount of between £250- £350 in order to pay for them. The prime aim of the packs was to speed the house buying process which it has to be said it completely failed to do. The original ‘plan ‘ was that they would contain a Home Condition Report (probably very useful) which was dropped in favour of a ‘watered’ down edition containing information of very minor relevance which was rarely requested by buyers. Ill conceived & badly implemented, together with the fact that the introduction of HIPs coincided with the dramatic market down turn, it is a wonder they lasted as long as they did. One must remember that an Energy Performance Certificate is still required but at much less cost.

CAPITAL GAINS TAX

Much talk among Landlords & property investors at present is Capital gains tax.  The tax is currently charged at 18%. The coalition Government plans to increase it to as much as 40 or 50 per cent. That will not affect normal homeowners, but it will hit anyone with a second home, or with investment properties that they rent out. The Government will announce details of the new rate in June's Budget, which means those who could be affected have a chance to sell ahead of the change and pay less tax.

HOUSE PRICES

Prices could slide upwards as details of the coalition Government’s policy towards housing become clear. Many Estate agents have already experienced a relative boom in the number of enquiries in the last week as potential homeowners who have been worried about buying in a time of uncertainty have re-entered the market. Prices more significantly will depend on the Governments short & medium term handling of the general economy, which of course is difficult to predict. Property values in Oxfordshire remain at pre- credit crunch levels, given there is still high demand & relatively low stock, so I feel it is very hard to see them falling assuming interest rates remain low. While there could be a number of additional properties coming onto the market due to the factors mentioned above, the number of people hoping to snap up a ‘bargain’ could be reduced by continued lender reluctance. The lending criteria & funds available from the Banks & Building Societies will remain an overriding factor on the market. The move toward a balanced market, roughly equal numbers of sellers & buyers with available funds, may still be sometime away?

We still have interesting times ahead.............