Over half of the brokers surveyed (53%) saw valuation issues impacting their businesses, while 59% saw it having an impact on their client’s opportunities. This is a 43 percentage-point increase since the 2018 broker barometer, where just 16% saw valuations as a potential issue.

Despite Connells’ survey and valuations business reporting a 2% increase in average property prices over Q2 2019, brokers are still concerned that down valuations are on the rise.

The increase in recent down valuations could well be attributed to market forces, most notably the uncertain economic climate driven by an ever shifting political landscape (the number one concern for the brokers questioned). Aside from Brexit, a decrease in purchase activity, the introduction of Section 21 and stamp duty have also been flagged as contributing factors causing escalating levels of caution around the UK property market.

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With a 3% growth in property prices (compared with Q2 2018) in London, Wales and the South West in Q2 2019, brokers with clients looking to purchase or remortgage properties in these areas should feel more positive, reflected in surveyor’s reports in the upcoming months. It is in regions such as the Midlands (6% down from Q2 2018) and Scotland (3% down) where down valuations are more likely to occur. 

Other causes for concern regarding brokers’ businesses were lending restrictions (36%), stagnating house prices (26%) and regulatory change (19%). Brokers also believe that mortgage interest tax relief (31%) and the impact of stamp duty changes (25%) will be the biggest issues impacting their clients after down valuations and Brexit. However, with uncertainty comes opportunity, and the value of good advice has never been more important to highlight as brokers seek to support clients looking to grow in an uncertain market.

Despite the current political climate and the fear of increasing down valuations, brokers are generally positive about the near future. Almost seven in 10 (67%) stated that they feel confident about the lending environment and over half (53%) feel confident about their business experiencing growth during this period. 

On an even more positive note, over half of surveyed brokers have cited a 10% or greater increase in business volumes in 2019 when compared with the previous year, with one in 10 seeing a 50% increase. Despite the array of challenges, it is clear that brokers continue to show their adaptability to legislative, legal and market changes, and there is still much to be positive about.