Article 50 is yet to be triggered and the EU already looks like it wants to play hardball by landing the UK with a £50-60bn bill for services as yet unquantified.
“a populist anti-establishment feeling sweeping the globe”
Hopes of a ‘soft’ Brexit appear to be increasingly unattainable with the current outlook, but it really is anybody’s guess at the moment, especially with elections in France and Germany this year.
With a populist anti-establishment feeling sweeping the globe, Italy and France may well see a real change in the political scene. Even if, as seems likely, Le Pen does not triumph in France, there will be a noticeable swing to the Right. In addition, the business world is waiting to see what a Trump administration will be like.
On a more local level, the changes to Stamp Duty Land Tax for buy-to-let as well as the forthcoming income tax relief changes for landlords are likely to have a continuing impact on the buy-to-let market, affecting both long and short-term mortgage lending. The Treasury, Prudential Regulation Authority and the Financial Conduct Authority (FCA) may yet introduce further changes, but I hope that they will wait long enough to really see the effects of the existing measures before implementing new ones.
“the FCA will have enough on its hands”
While there is always talk of further regulation, unless there is a major incident in one of the financial sectors I think the FCA will have enough on its hands with its newly announced review into advice and competition. On a wider level, the issue that is not really discussed but which I believe is of the most concern is the level of indebtedness – both for individuals and the country as a whole. This level is unsustainable and will have consequences for everyone sooner or later.
It is uncertainty that is likely to have the biggest impact on the mortgage and bridging markets next year. People often put off making big financial decisions if they feel uncertain about what the future may hold.
“change has become the new constant”
To end on a positive note, in many ways change has become the new constant and, as a result, an increasing number of people will continue to get on with their lives and their businesses. The value of bridging loans written in the year ended 30 September was up by 15% over the previous year. So while I expect individual quarters this year to fluctuate, I expect bridging lending as a whole to continue to rise across 2017, although at a slower pace than it has done in the past.