The Budget did not go down well in Cannes, reports Brecher’s Nicky Richmond in her latest missive from MIPIM…
Its like a stag party, said the client, but with business cards…
It seems incredible but only it’s only a day a half since I arrived and it already feels like I’ve been here for a week. The heavy rain has put a dampener on proceedings and no-one wants to sit in the beach restaurants, the waves seeping under the flimsy awnings and the crack of the plastic in the wind drowning out conversation.
But once you’ve got over the weather conversation beloved of all Brits there are themes emerging. I have heard these words come out of many mouths, in varying degrees of certainty:
- Prime Central London is dead for the next three years at least;
- Brexit will be good for property;
- Brexit will be bad for property;
- We don’t know what Brexit will mean for property (actually, no-one admits that one);
- The northern cities are the new London;
- Many of the newer lenders in the market are going to struggle in the next two years (said by the more established lenders, obv);
- The Americans are back in the market in a big way;
- The Americans are moving out, scared by Brexit uncertainty;
- Mothballing. With reference to many developments, particularly those in or around Vauxhall.
And it was good of the Chancellor to time his budget over MIPIM lunchtime so we could all choke on our chips as news about the change to commercial property stamp duty started to appear on peoples’ phones. Calls were made by both buyers and sellers to their lawyers, buyers trying to save money, sellers trying to avoid the price chip in the morning.
Not only that but the proposals to limit tax deductibility of interest to 30% could be catastrophic for those companies who rely on debt funding (i.e. the bulk of the industry). To many, it feels like yet another kick in the privates from a Tory government treating the property industry like a cash cow.
And in what appeared like a glimmer of hope, the second home owners were smiling into their sambuccas at the reduction in CGT, until they realised that residential property was excluded.
Some of the more outspoken are talking openly of recession and those predicting growth in central London resi are looked on in much the same way as climate-change deniers.
But the rain is predicted to lift today and I’m determined to find you a good news story for tomorrow. Wish me luck.