During the last recession, the Kent commercial property market, in particular, was seriously affected, with values dropping in some areas by as much as 40%.
The market began to recover in early 2014 and into 2015, with gradual, modest increases in rents and capital values in major property sectors; particularly within larger towns. Investment properties became particularly attractive, with many investors who had been priced out of London, regarding Kent values and returns as attractive prospects.
However, investor interest became noticeably more cautious in early 2016 and was put down to the prospect of the then looming EU referendum. On the other hand, the majority of the market continued as it had been since 2014; confidence was high and transactions continued. Then the UK voted to 'Brexit' the EU.
Now, daily articles inform on the impact of this decision and the potential outcomes. Businesses and correspondents differ in their opinion with some convinced that a recession is on the horizon, and others are quick to promote any positive aspects of Brexit.
Three BBC business news stories, all published during the dying days of July, illustrate this divergence.
The first is a report on the latest Office for National Statistics (ONS) figures showing that the UK second-quarter gross domestic product grew faster than expected – up to 0.6%, from 0.4% in the previous quarter.
The second documents how GlaxoSmithKline has announced it is to invest £275m to expand its UK manufacturing sites (http://www.bbc.co.uk/news/business-36901027), whilst the third recounts residential estate agency firm Foxtons has reported a 42% reduction in profits (http://www.bbc.co.uk/news/business-36922496).
In the immediate aftermath of the vote there was market turbulence, but in the last month transactions have continued and new instructions are being to be brought to the market.
Banks may reflect the uncertain post-Brexit mood in their lending, and some businesses could postpone decisions on expansion, investment and new premises.
One thing is for sure, that market sentiment has been affected by this uncertainty. However, it is easy to confuse other factors as being related to the Brexit decision. For example, the changes in Stamp Duty and Land Tax announced in the budget and introduced in April saw a rush for transactions to complete before the changes were implemented. This will have been reflected in the following quarters' figures.
It is still too early to judge the economic impact of the UK's decision to abandon its membership of the European Union and it would be easy to talk the country into a recession. But it is important to ask what we actually want.
Once Article 50 has been activated and negotiations between the EU and the UK commence, an eventual agreement for our future relationship with the EU will emerge. Thereafter, the market will be in a much better place to declare its considered reaction to this monumental decision.
However, there is no need for an immediate or knee-jerk reaction. Ashford is proceeding with a number of key development opportunities including leisure, commercial, residential and educational schemes; Ebbsfleet Garden City is progressing and permission has been granted for 154 new homes and a new 420-pupil primary school in Castle Hill, work is already under way on more than 470 homes and there is discussion on a commercial development around the station; and funding has been committed and a contractor appointed to deliver the St James 156,915 sq ft retail and leisure scheme in Dover.
So, for now, there is plenty to celebrate in the local market.
The Royal Institution of Chartered Surveyors created RICS Matrics to nurture the interests of members whether new to, or those not long in the profession of surveying.
RICS Matrics Kent members have recently voted for their new local group board and Caxtons' staff have been elected to places at the top table.
Caxtons has always supported its trainees and graduate members of staff and is delighted that the following staff have been elected to the board:
James Roberts, a Commercial Agency Manager at Caxtons in Canterbury has been elected as Vice Chariman. James specialises in acquiring and disposing of commercial property for a range of clients.
Kazeem Agboola has been re-appointed as Treasurer. Kazeem's day job is a Commercial Property Manager and he is based in Caxtons' Gravesend Head Office in Windmill Street.
Tatenda Metzger has been elected as the Student Liaison member. She is a graduate surveyor in the Professional Department at Head Office.
Finally, Tom Foster has been appointed as a committee member (without portfolio) and is a graduate surveyor in the Building Department in Gravesend.
The 40 local RICS Matrics groups provide a network, support and a voice for its members as well as a source of energy for the surveying profession.
It is youthful, forward thinking and provides an environment of inclusion for its newest members to grow and feel like an integral part of the RICS.
Activities at the Kent group includes a monthly event and sporting activities for fun and friendships but focuses on networking to engender long lasting contacts with other professionals and developing their skills.
The 2016 budget created a flare-up in government, but was there a stir in the property sector? Contrary to some rumours, there was no U-turn on stamp duty for purchasers of buy-to-let or second homes, and thus the 3% surcharge looks like it is here to stay.
One announcement that brought a smile to smaller investors was the announcement of new rates for commercial stamp duty land tax (SDLT).
George Osborne made his statement, saying that there would be 'big tax cuts for small firms'.
Charlotte Bland, Associate Director, Commercial Management and Investment said: 'The announced changes came into effect on property purchases completed on or after 17th March 2016 and it is true that this measure favours small investors, individuals, personal pension schemes and small / medium size property companies.
"Less SDLT will be due than before as long as the price of the property in question is below £1.05m.
"Prior to the announcement, on a commercial property purchase of £300,000, the stamp duty would have amounted to £9,000. Now it will be £4,500 – a real reduction of 50%.
"As with residential SDLT there is a rising scale of duty applied depending upon the purchase price which will now be applicable on "slices" of the value. On commercial property below £150,000 no stamp duty will be payable; on the next £100,000 of the purchase price the rate will be 2%; and a top rate of 5% will be due on any amount over £250,000"
This may attract more, smaller investors to the commercial property market, especially in light of the additional duty that residential buy-to-let investors will incur, coupled with the impending withdrawal of tax relief on mortgage interest rates.
Charlotte continued, "While commercial investments may be subject to more risk than residential property, on the plus side, relative returns are higher."
Also, the changes will now mean that an investor will achieve a higher return on any commercial investment purchased below £1.05m due to the reduced stamp duty they will now pay. The downside is that this change may lead to an increase in the value of properties for sale, as the market naturally re-adjusts and any saving on costs will be negated by increases prices.
Another downside of this change to SDLT is that purchases over £1m will be adversely affected and property price will be a deciding factor when calculating net returns. Larger investors – such as Pension Funds – will be disadvantaged with the stamp duty on a £10m property purchase increasing from £400,000 to £489,500.
However, the Chancellor assured his audience that only '9% of buyers would pay more than before, while the tax bills of 90% of purchasers would be cut or stay the same.'