“You basically have clients that are just tracking down towards either the next election in the US or the next election here, because we’re kind of seeing either way,” he said. “Everyone is impacted by anything that happens in the States and at the moment, everything that has happened hasn’t been particularly great for us.”
That uncertainty extends to hiring decisions. “We’re all in a situation like I am, where it’s expensive to employ people. That’s only going up. There isn’t really any relief anymore offered for anything, so you kind of end up in a situation where you’re reluctant to expand, hire and grow because you’re in a market where it’s not really pro-growth at the moment.”
Lender conversations are confirming the trend. “The lenders we talk to say business volumes for them are down. Some of them have had their worst quarters they’ve had in years, and it’s just because no one wants to do anything at the moment.”
Stamp duty: the biggest drag on housing activity
When asked what the government could do to restart the market, Yeates didn’t hesitate. Stamp duty, he argued, is the single biggest structural barrier to housing transactions, and its impact is felt at every price point.
“If someone is drifting outside of a stamp duty exemption, it’s money you can’t borrow. It’s suddenly a lot of money. You get into the territory of a normal couple buying a house now, who will spend most of the net salary of one of those borrowers on stamp duty if they try and move home.”