This year began with a growing uncertainty about the strength of the UK economy, coupled with dramatic downward predictions and gloomy forecasts from anyone who claimed (however remotely) to be a property expert.
The Bank of England stepped in several times to slow the rate of inflation with base rate increases. Whilst Putin’s invasion of The Ukraine caused a titanic uplift in energy prices and therefore the basic cost of living. This was a rocky period for the UK economy, and therefore the property market.
Once again monumental Fear stepped in and uncertainty and unrest hovered like a dark grey cloud threatening to drop the heaviest hail stones on the lives of many already effected by the events of the last few years.
August saw a downturn in market confidence, which worsened when Liz Truss and Kwasi Kwarteng announced their chaotic fiscal plans and a somewhat quiet property market followed in the run-up to Christmas, with both buyers and sellers cautious to find out what would come next…
The news that came next was not the doom and gloom forecast by the media but suggestions that inflation, the bank base rate and the cost of living would not reach anywhere near their predicted figures.
There was most definitely a fallout from the mini budget and to counter that, the Bank of England put up the bank base rate, resulting in a steep rise in mortgage rates. Thankfully, due to a period of relative economic and political calm, mortgage rates have settled down and are now returning gradually to levels close to the long-term norm.
So let’s all take deep breaths and pass on the feeling of hope and encouragement.
It is of course early days but there are definitely signs that suggest a more encouraging 2023.
Remember property is fickle and we have to hold it loosely. We need to move with the times, be aware of what’s going on and ideally be one step ahead.
This will always mean being diligent with risk analysis, it will mean being bothered to understand as much as is possible the situation of our economy. It will mean covering every base so to be in control rather than allowing ourselves to be controlled.
Be that person who thinks in terms of abundance, not scarcity, in terms of positivity and growth.
We are in this together, and together we will ride the storm. There is an element of risk in all types of investing but risk can be mitigated if we have clarity in what we are doing and if we are knowledgeable about our economy. This will cause courage to rise and fear to dissipate.
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