If you are feeling a bit mopey just remember the following:
January is always crap.
Around the 19th is documented as the worst day of the year – lots of people who are paid monthly are skint, and January is a long old month to be skint. We barely move above 8 hours of daylight. The odds are stacked against us.
Layer a pandemic on top of that and a lockdown to boot and it puts it all into context. The days are getting longer, the temperature is getting warmer, and the case rate is coming down (with death rate and hospitalisation to follow within 7-10 days).
More significant news that everyone will have been offered the vaccine by the end of June. Good news so far, and no mandatory vaccinations. A moment to tip the hat to the vaccine delivery process – despite the press trying to poke holes in it at every opportunity (“they are wasting the vaccine!” – yes, only when people don’t turn up to appointments!!!). Superb so far and it is sad to take a pandemic to find a situation where the UK can lead the world, but there have been some brilliant moments in the face of adversity.
Unfortunately we are also leading the world (or nearly) in deaths per 1m of population due to Covid. Worse than the USA. That’s horrific and the vaccine rollout will change that I think, but with deaths likely to hit 90k today on the published figure, there will be questions to answer for at least a generation.
The press is also on the case of the housing market…..with regular headlines telling us that the stamp holiday will NOT be extended. The language still seems to avoid any word of a reform. I imagine with the leak around stamp last time Rishi has learned a lesson and the team are instructed to remain incredibly tight lipped.
The other piece that’s attracted some noise this week particularly in the London media is the flat market and cladding/EWS1 forms. This story will run for years due to lack of action and the bill – already up from 6bn to 15bn – will end up much higher no doubt. These things always follow a typical pattern.
There’s also been multiple bits of chatter around a stronger lockdown and nurseries closing, alongside agents closing. With the case rates dropping as they have for the last several days, my view is that the government will hold on and not change anything more. Scotland have tightened things as of yesterday but are following what they’ve done all the way through and be stricter than the other devolved nations.
Headlines around price movement are mixed. The usual crash predictions from the usual places. Some more technical and realistic analysis in the more cultured media e.g. the FT. Sideways has been my prediction with some ups and downs and that’s still where I am at. Remember inflation has been low for the past 12 months and wage inflation has still been healthy (this is vastly underreported) with it still being at nearly 3% YOY in December. So there’s some underlying fundamentals going OK for housing. I’m going to go on record and say that the end of furlough – however it comes, no doubt tapered by a job support scheme of some kind – will not lead to a particular issue for the housing market but it comes at a bad time because April will look quiet on any metrics because of the end of the stamp holiday – and that will go into May as well. Early May might see some decent opportunities for purchasers and will almost certainly be a buyers market.
Rents seem to be rocketing and demand is still huge. Inside our portfolio we are hitting new highs for rents. The impact of EICRs has not yet been felt as many many properties are still being let without them and I think the EICR rules mean more opportunity than any recent compliance changes, because electrical work is largely expensive and as and when enforcement starts (or should I say if, or is that too cynical?) There will be disposals.
Next week there will be a new president, assuming the US is still going…..until then, have a good week and stay safe and positive!