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By Steve Richmond

General Manager, Reapit UKI


Inflated expectations? Be a pragmatic advisor in an uncertain market

The recent dip in inflation to 2% for the first time in three years brings a glimmer of optimism in the ever-shifting landscape of the UK housing market. However, as we edge closer to a pivotal election, the market's future remains shrouded in uncertainty. This duality of hope and apprehension creates a unique challenge for both buyers and sellers. As estate agents, it's crucial to guide your customers through this uncertain terrain with a pragmatic approach.

It’s unnecessary to dedicate too much space towards the upcoming election; the ins and outs of that particular event are already well-ingrained in everyone’s psyche and barring a rather unexpected outcome, it’s looking likely we’ll have a Labour government on the 5th of July, potentially with a large majority, and that’s going to lead to a significant shift in housing policy over the coming years. What it does not necessarily mean, however, is that much will change immediately, as while words are quick, policy usually takes longer to implement.

The pragmatic approach we should all take, however, is to reflect on the known factors of the market today, and the impact those will have in the foreseeable future. For instance, the Bank of England chose to hold the base interest rate at 5.25% at their last meeting on 20 June in order to meet the 2% inflation target, a target that has now been met. This was a widely expected, if not somewhat disappointing holding pattern, though there is now an increasing likelihood that the Bank will finally cut rates at their next meeting on 1 August.


When that cut does finally come, it should have a relatively quick impact on the market with lenders hopefully being more agreeable to cutting mortgage rates, giving first-time buyers and remortgages a boost. This would come at a time when affordability remains a centrepiece of the housing crisis, though I would not wager it to be that bad. Nonetheless, a more optimistic outlook emerges when we see that average wages have grown by 6% on the annual, according to the most recent data from the Office for National Statistics, suggesting that properties are getting more affordable.

Yes, we can’t ignore the obvious that house prices have surged in recent years alongside wage growth, but that was coupled with some dips earlier this year, and it was only last month that house prices returned to growth. With Capital Economics forecasting that interest rates could come down to 3% in 2025, and if inflation continues to be contained at or below 2%, there’s a stronger likelihood that affordability and the cost of living in general could become more manageable over the coming months if conditions improve.

Leading the customer journey with confidence

No doubt there will be many buyers and sellers still facing uncertainty, and they will be carefully deliberating whether they should move forward with their next big move and whether the time is right. That’s where the vital role of the agent comes into play because they’re the pros that can offer guidance when difficult and often life-changing choices must be made. Those of us who have been in the business long enough have seen the ebbs and flows of the market, and we’ve become accustomed to navigating conditions as they fluctuate. So, when your customers face uncertainty, it’s the vital role of the agent to be their champion of confidence, to offer insight, build trust and be realistic.

A common question that comes through is whether it’s a good time to buy or sell, and that’s sometimes a hard one to answer given that every customer’s financial situation and personal expectations and needs are unique; and in a market characterised by uncertainty, inflated expectations can be a significant hurdle. But by fostering a pragmatic mindset among buyers and sellers, agents can help ensure smoother transactions and more realistic outcomes.

Indeed, as the market evolves, staying informed and adaptable will be key to success. With house prices surging over recent years, many sellers have inflated expectations of their property’s worth. Meanwhile, buyers, aware of potential market corrections post-election, might be hesitant to commit. This disparity often leads to stagnation in negotiations. However, by educating customers on current market conditions and realistic pricing, agents can help bridge this gap, leveraging market conditions to encourage the focus on long-term value rather than short-term fluctuations.

No property search is a perfect journey and ultimately the process is going to involve some compromise on the side of the buyer. In many ways that’s where technology is a necessary and useful tool for agents to help provide more material information to customers that informs their search. Modern estate agency must carefully blend technology and people skills to succeed, and house buyers will always be better off having a trusted professional alongside them, addressing their questions and helping them make the right decisions in an uncertain market.

Of course, we must still set realistic expectations as conditions won’t magically improve, but there are opportunities to get good deals in a more confident market where pent-up demand can be unleashed. So, be pragmatic in your advice in harmony with your tech to link buyers with the right properties and paint the best picture possible that sits between their feasibility and desire – they want the apple cart not the apples and the orchard could be rich pickings for agents in the months ahead.


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