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Jul 24, 2016: Lettings agents call on UK govt to help restore confidence in lettings market

A leading group of lettings agents in the UK is calling for the Government to take action to restore confidence in the residential lettings market in the aftermath of the vote to leave the European Union.

There has been a cooling in investment in the lettings market due to pre-referendum uncertainty, plans to cut mortgage tax relief for landlords and now Brexit, according to Belvoir Lettings, at a time when there is growing tenant demand.

‘With the Bank of England hinting at further reductions in interest rates, which will continue to hit savers, property remains a very attractive long term investment opportunity, particularly for those with cash to invest,’ said Belvoir managing director, Dorian Gonsalves.

‘However, in some areas continued uncertainty over the future of EU nationals in the UK is having a negative impact. For example, in Boston in the East Midlands, which was reported as being the most pro-Brexit town in the UK with 75% of the population voting to leave, thousands of EU workers remain anxious about their immigration status,’ he pointed out.

‘We hope that the Government will act quickly to resolve this uncertainty and reassure EU citizens about their future in the UK. This will also help to reassure those overseas landlords who are also expressing concern,’ he added.

Indeed, Donna Burrell, owner of Belvoir Boston, reports that although the rental and sales market has now picked up, there is continued anxiety amongst Eastern European workers, with many now adopting a 'wait and see' attitude before committing to investments.

‘During the build up to the referendum we noticed that business was quiet. Belvoir Boston now provides an estate agency service, and prior to the referendum many Eastern European tenants who had been working and renting in the area had started to buy the properties they had been renting. Now that Britain has voted to leave the EU we have noticed a more cautious wait and see approach and some have pulled out of sales,’ she explained.

‘There has also been some racist backlash from a minority group, which is making Eastern European tenants and foreign investors feel uncomfortable about committing to investment. Boston is reliant on Eastern European migrants to work in factories and keep local businesses afloat. If these workers feel forced to leave, it could potentially be catastrophic for the town, its people and local businesses,’ she pointed out.

‘I really hope that the Government will end the uncertainty by giving out a strong message of reassurance, as many of these people have worked and lived here for several years, and contribute enormously to the community,’ she added.

According to Emma Falco, co-owner of Belvoir Peterborough, Brexit has been a hot topic for landlords and tenants, but whilst there is a lot of conversation surrounding it, it doesn't seem to have deterred serious investors.

‘In fact, I think many still have the 2008 crash in their minds and are hopeful that they may be able to pick up a property bargain in the coming months if the market drops, as predicted. Now that property prices have risen back to their 2007 values many investors wish they'd had the confidence to buy when prices plummeted in 2008,’ she said.

‘In my opinion, investors should still consider property as one of the best places to put their money. For example in Peterborough, an average rental property would generate a landlord a 9% return on the capital they employ,’ she explained.

‘Investors will not get anywhere close to this by leaving their money in the bank. Regardless of what happens to property prices in the short term, the demand from tenants is ever growing,’ she added.

http://www.propertywire.com/news/europe/uk-lettings-agents-confidence-2016071812154.html


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