Less than 24 hours after the Budget and the Chancellor, Rachel Reeves was already admitting that her £40bn tax-raising Budget was likely to hit pay for workers.
She said it’s likely her increases in employer NI contributions (up from 13.2% to 15%) is likely to affect employee pay packets as businesses either absorb the increase or award lower wage increases.
All of which is bad news for property professionals employed in traditional agencies up and down the country.
And, as if to add insult to injury, the 6.7% increase in the Minimum Living Wage to £12.21 an hour from next April will also add to the wage bill of some agencies with full and part-time staff.
REDUCE COSTS
This could result in some businesses having to reduce costs and make staff redundant
This is where self-employed agents have the edge in terms of cost control. Because they are building a business around themselves as individuals, they can work flexibly and control their costs more effectively through technology – without the need to employ others or pay for expensive premises.
TICKING ALONG
So, if there are confident, experienced agents out there who don’t relish the prospect of stagnating wages, I say to them that they should strongly consider going it alone and joining the growing band of self-employed property professionals growing their own businesses and creating their own work-life balance.
The market is beginning to tick along nicely and there was nothing in the Budget that is likely to halt that trend, as far as I can see.
We look forward to further cuts in interest rates – perhaps even as early as next week – and more would-be homeowners overcoming barriers to affordability and entering the market. The conditions look set fair for the rest of this year and into 2025.
“There is no reason why the market shouldn’t settle into a period of consolidation that will last into the medium term.”
Provided the economy remains steady with low inflation and interest rates easing, there is no reason why the market shouldn’t settle into a period of consolidation that will last into the medium term.
Anyone who has been put off from striking out on their own because of economic shocks and unpredictability should take comfort from the fact that the Chancellor placed her emphasis on stability which is the number one pre-condition for a thriving property market.
MAKE A MOVE
The emergence of more buyers will, inevitably, tempt more sellers to make a move so there will be business out there to be won.
We know that the market here in the UK is trending more towards the US and Australian model every day with more and more agents working for themselves.
The state of the market and the Budget is giving ambitious property professionals the opportunity to get a head start by branching out right now and building their business for the future.
Companies like the Property Experts will provide the technology and the marketing tools, but it is the individuals themselves who bring the drive and set the pace.
Sean Newman is founder of The Property Experts
