Century Capital Q2 Market Report

Executive Summary

By Paul Munford, CEO and Founder of Century Capital

Exciting times for Century! This quarter, we have witnessed exceptional growth – our loan book for this year has doubled thus far, and we have successfully launched our latest product, Century PLUS. Most notably, we have seen an increase in big ticket loans for prime London assets; stand out examples include a grand £65 million mansion, and Embankment flats valued at £10 million each. In comparison to Q1, we have doubled the total number of deal completions, and diversified our portfolio with an increased emphasis on Greater London and the Home Counties. Since expanding our operating sphere, deal completions in Greater London have increased by 25%.

Our ambitions to grow our product offerings and geographical reach are being realised. Century have extended terms with our principal funding line for another two years, and forged a new relationship with Hampshire Trust Bank to secure an additional £25 million in capital. This new funding line will be used to substantially strengthen our product offerings, especially to meet the exponential demand for our second charge product. Meanwhile, the recent launch of our new product Century PLUS is further evidence of our impressive growth and our innovative approaches to creating industry-leading products. Century PLUS caters to more mainstream markets, with fixed rates from just 0.89% for both first and second charge loans on residential properties nationwide.

Moreover, we are pleased to have welcomed Kynan Benjamin as our new Head of Lending, while his predecessor Luke Navin steps into the role of Managing Director. With seven new hires this year, we’ve outgrown our previous office and have relocated to 2-4 Cork Street, Mayfair.

The summer events season kicked off with a bang, with Century hosting a number of events to strengthen our long-standing relationships with brokers, borrowers, and partners. Some of the highlights include wine tasting with Knight Frank, an afternoon at Chestertons Polo, and our inaugural Women in Property event at the Peninsula. Finally, I was exceptionally humbled to receive the prestigious ‘Most Promising Newcomer’ award at this year’s PROPS Awards – only took 30 years in the industry!

Industry Insights

By Luke Navin, Managing Director of Century Capital

Following Labour’s landslide victory in the general election, the UK property industry anticipates a series of sweeping reforms to meet their promise of building 1.5 million new homes over the next five years – a tall order in the current interest rate environment. The latest analysis from Savills currently suggests a degree of caution in the prime property sector, as buyers hold off purchases in the coming weeks, biding their time in the wake of the Labour victory in case of any surprise reforms.

The new government are already heeding promises made in their manifesto to reform planning systems, the private rental sector and enforce further taxation on the wealthiest – plans that have since been elaborated on in the King’s speech. The large majority are generally optimistic about these legislative upheavals, however the prime luxury sector is more apprehensive.

Reforms include reverting the rate band for stamp duty back to £300,000 from it’s temporary level of £425,000, which is likely to particularly impact first-time buyers. Overseas buyers will pay an extra 1% stamp duty surcharge, and renters’ rights will be overhauled with a new bill. The party have remained tight-lipped about increasing Capital Gains Tax, although supposedly there are no plans to immediately increase this in the first Labour Budget.

The non-dom tax reforms will likely be the most keenly-felt impact of the new government in the prime property sector, as the majority of Labour’s housing plans revolve around restructuring the current planning system, as well as the construction of social and affordable housing. Hopefully, these much-needed positive changes will grant lower income households a foothold on the housing ladder at last.

On July 17, the inflation rate once again remained at 2%, meeting the Bank of England’s targets. The FT reports that the MPC are subtly signalling that they are on the cusp of cutting rates, although there are still no concrete signs. Any hopes for an August reduction are rapidly dwindling at their continued hesitation on the matter.

Despite the change in government, we are optimistic of continued market activity and growth as we move into the second half of the year. We are confident that property transactions and prices will continue on their current upward trajectory.

View the full report here.