Estate agents dismiss crash fear
ESTATE agency group Countrywide today warned of the 'dampening effect' of recent interest rate rises, but added that a price crash appeared unlikely.
The group, which has 875 UK offices including the Bairstow Eves and Mann & Co chains, said in a trading statement that business levels since March had continued 'in a very encouraging manner'.
Countrywide said the first six months of the year had seen an increase in the number of sales being arranged, coupled with a rise in house prices.
It did not believe this would be followed by a property slump, although it did warn about the impact of higher borrowing costs.
It said: 'Recent interest rate rises will, we believe, have a dampening effect on the residential property market - but we are currently of the opinion that a sharp correction in either volumes or prices is unlikely.'
Essex-based Countrywide recently demerged its life assurance arm Chesnara in a move that left it with its estate agency business, as well as operations in surveying and valuation, conveyancing and mortgage consultancy.
Countrywide said its surveying and property law operations were using third parties as they currently had more instructions than they could handle.
Retail financial products continued to be arranged for a 'high proportion' of home buyers, the company added.
In estate agency, Countrywide said the value of commissions on contracts in the hands of conveyancers awaiting exchange stood at a record level - £15 million or 25% higher than a year earlier.
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