Despite the uncertainty over Brexit, Stamford’s property values (and most of the UK’s) continue on a medium and long-term upward trajectory. As economics is about supply and demand, the story behind Stamford’s property market can also be seen from those two sides of the story.
Looking at the supply issues of the Stamford property market, putting aside the short-term dearth of property on the market, one of the main reasons of this sustained house price growth has been down to of the lack of building new homes.
Over the last 70 years, the draconian planning laws (starting with The Town and Country Planning Act 1947) has meant the amount of land built on in the UK today, only stands at 1.8% (no, that’s not a typo – its one point eight percent) and that is made up of 1.1% with residential property and 0.7% for commercial property. These 70-year-old planning regulations are restrictive and irrelevant to today’s housing needs and don’t reflect on the type of homes badly needed by Stamford’s young and growing population.
Looking at the demand side of the equation, one might have thought property values would drop because of Brexit and of buyers’ uncertainty. However, certain analysts now believe property values may actually RISE because of Brexit. Many people are risk adverse, especially with their hard-earned savings. The stock market is at an all-time high (ready to pop again?) and many people don’t trust the money markets. The thing about property is its tangibility; you can touch the bricks and mortar and you can easily understand it.
As a nation we have historically put our faith in property, which we expect to rise in value, in numerical terms, at least. Nationally, the value of property has risen by 635.4% since 1984 whilst the stock market has risen by a very similar 593.1%. However, the stock market has had a roller coaster of a ride to get to those figures. For example, in the ‘dot com bubble’ of the early 2000’s, the FTSE100 dropped 126.3% in 2 years and it dropped again by 44.6% in 9 months in 2007… the worst drop Stamford saw in property values was just 16.7% in the 2008/9 credit crunch.
Despite the slowdown in the rate of annual property value growth in Stamford to the current 6.92%, from the heady days of 12.81% annual increases seen in late 2015, it can be argued the headline rate of Stamford property price inflation is holding up well, especially with the squeeze on real incomes, new taxation rules for landlords and the slight ambiguity around Brexit.
With mortgage rates at an all-time low and tumbling unemployment, all these factors are largely continuing to help support property values in Stamford (and the UK).
For a current market appraisal of your property, please contact me.
David Crooke, owner UPP Property Agents
Stamford: 01780 484 554
Rutland: 01572 725 825
Email: david@upp-property.co.uk
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