Lancashire law firm Forbes Solicitors which has nine local offices including Preston and Blackburn is warning that although the economy is taking a step in the right direction, any recovery in 2010 is likely to be very limited.
As 2009 draws to a close, most Lancashire businesses are feeling that their profit margins are under pressure. Official figures for 2009 show that in the period to the end of the third quarter, the UK economy had shrunk for six consecutive quarters. Economists seem to think that 2010 will be a year of economic recovery but that that recovery will be very limited with growth forecasts of about 1%. Added to these rather gloomy forecasts will be an increasing tax burden for both individuals and businesses as of January 1st when the VAT rate increases to 17.5%.
As far as house prices are concerned, many commentators predict that these will be flat in 2010 and some forecast further falls. Much will depend on the attitude of banks and building societies to lending and whether borrowing to buy houses is made any easier. Homeowners have however already been warned that mortgage rates are likely to increase in the next twelve months. It is predicted that in 2010 net lending which is the amount of extra money provided for home loans on top of repayments collected by lenders will increase from £8 billion to about £15 billion. The Council for Mortgage Lenders also predicts a rise in the number of housing market transactions from 810,000 in 2009 to 850,000 this year. To put this in context in 2007 there were 1.6 million transactions. It seems unlikely therefore that 2010 will see a return of the residential property boom.
John Barker, Managing Partner of Forbes Blackburn office states that, It is against this economic background for the UK as a whole that we need to consider the prospects for Lancashire.
He comments further, In a year when growth in the country is expected to be limited, the Lancashire economy will face severe challenges. The Local Authorities in Pennine Lancashire and the North West Development Agency have agreed in principle funding for the future economic development of the area. The priorities which they identify are aerospace/advance manufacturing, skills/higher education, digital and physical connectivity and housing. Attracting such funds to the area will be vital if the area is to move forward in 2010 and beyond.
Forbes Solicitors Preston also has expert lawyers based at offices in Blackburn, Chorley, Accrington, Manchester and Leeds. They offer advice in all areas of the law, acting for both businesses and on individual private matters. They have also been awarded Corporate Law Firm of the Year for the past two years at the Insider Lancashire Dealmakers Awards.