Estate agent Jim Colver has given his opinion on the takeover of the local steelworks by Greybull Capital suggesting that the local property market will benefit. Those who follow the UK steel industry will be well aware that it has been in trouble for some time and Tata Steel has been looking for an exit from the UK market at minimal cost. News that the Scunthorpe works have been taken over should give some short to medium term security for thousands of workers and the local economy.
Confidence breeds confidence
In will be interesting to see if this confidence does translate into increased demand for Scunthorpe property and boost prices which have not performed too bad in recent times. There is a general opinion that the recent positive price performance in the region may well have been as much down to a lack of suitable property for sale as increased demand. There is also the tax element with new regulations coming into play forcing many investors to bring forward their purchase plans.
Whatever the reason for the recent uplift in property prices in the region there is no doubt that confidence does breed confidence and hopefully the long-term security of the steel industry has been secured.
Can one company really make a difference?
While the steel works in Scunthorpe have been highlighted as a positive long-term impact on Scunthorpe property prices it is not necessarily one company but more one industry which is having an impact. This perfectly illustrates the pros and cons of overdependence upon one or a small group of industries in any particular part of the country.
The North of England is an area that historically depended on the mining industry which has all but disappeared in the UK. As a consequence the region was forced to reinvent itself and the likes of the Nissan plant in Sunderland were a welcome addition. The impact of specific business sector difficulties is not necessarily such an issue in the South of England where there seems to be a greater spread of types of business. However, that said, when the banking crisis hit home there is no doubt this did impact some of the more sought-after areas of the UK property market!
While there is no doubt that the Internet has changed the way we interact with each other, both on a personal and business level, positive words from leading figures in the local estate agency sector do catch the attention of investors. Whether we will see an uplift in property prices in the region remains to be seen. In the short term positive comments are obviously most helpful but in the medium to long term we need to see this translate into actual demand for property.
Some investors will see this situation as yet another example of how the media can influence both national and local property markets. Positive headlines bring a feelgood factor back to the investment arena and it will be interesting to see whether they do actually have a positive impact on property prices.