I’m fairly sure there won’t be too many people whose livelihoods revolve around the property industry who won’t be mighty glad to see the back of 2019. For one reason or another, it was a very challenging climate and forced a lot of businesses to go through many changes and adaptations to come out of it in any degree of health.
- Brexit – The soap opera it has been has removed massive confidence from the market. Fewer were prepared to make decisions and commitments.
- Investor Tax Hammering – The investor market was obliterated by a series of penal taxations that are continuing and have removed a large percentage of those who might have bought from the market.
- Fewer Landlords – The above not only stopped landlords entering the market but persuaded many to give up and sell the property they owned.
- Election – The calling of an election further cooled the sales market at the back end of the year.
- Tenant Fees Ban – A crucial income stream was removed by law that forced letting businesses to remodel their entire pricing structures to mitigate the losses.
That’s not to say all of this has been a bad thing. Often the time of most opportunity is when things are challenging. Those who are braver and more open to change can gain traction. It has meant most businesses will have had to go through some serious financial management as the likelihood is they generated less income than the year before.
Austerity may not go down very well with the public at large as an economic policy, but personally I consider effective (tight) management of finances essential for the longer-term health of my business. I can’t spend out more than I bring in. Same at my home. And in my view, same for the country. I appreciate of course you have to invest still, but the principal remains that spending what you haven’t got with borrowing, to make yourself feel better and maintain a lifestyle in the short term is short sighted and simply giving you a false sense of security. It’s lining up a bigger problem down the line. Sometimes you have to cut your cloth accordingly.
I’m maintaining that stance for at least Q1 of 2020 until I see what I hope is a more bullish market following the Brexit scenario being resolved. Irrelevant of your politics, the fact there is a decisive outcome imminent is economically a very good thing for now at least. The result is I’m quietly confident the steps we have taken in 2019 will stand us in very good stead not just for 2020, but well beyond too.