Brexit is proving likely to affect every element of our lives in the UK and that includes our ever-changing and unpredictable property market. With many opinions, hopes and fears being conveyed, we summarise the key predictions for the property market as a result of the Brexit process.
According to Mark Carney, Head of the Bank of England, a No Deal Brexit could see up to 35% slashed from UK property prices. In turn, investment in house building will also drop. Actually, we have already seen the share prices of the UK’s biggest home builders, such as Persimmon, drop dramatically since June 2016. House prices in the UK have all but stagnated in most parts of the UK so far this year. However, a major crash is unlikely, and most experts predict that despite a bad start to the year, provided the UK gets some deal, prices should hopefully rise by a modest 2-3% by the end of 2019.
Brexit is just one candid that we need to sail a way past in 2019; politics, the economy and self-assurance in general will all have a notable part to play on charges. Brexit may have been overly dramatic as the main offender for current market misery. Rates have soared so far and so quick in current years – specifically in London and the South East – that an extravagant rejection was unavoidable.
One major prediction is that the divide between the south and the north, in terms of property prices, will get narrower. As London and the southeast bear the brunt of any price squeezing as a result of Brexit, prices in the North have already started increasing at a faster rate and are likely to continue to do so.
At one point, interest rates will have to rise, but uncertainty over Brexit could delay this further. Any rises will be small and incremental.
The rental market continues to grow, despite greater financial constraints for landlords. But if prices do crash and mortgage terms don’t get easier, it’s likely that buy to let investors will snap up properties. With more rentals on their books and greater scrutiny of contracts, it’s important that estate agents are investing in their lettings sector, with better IT, such as property inventory software like inventorybase.
One thing we can be certain of is uncertainty. Many people are currently putting off buying or selling property until they know what is going to happen. Even after March 29th, the picture is unlikely to be completely clear.
The property market is always hard to predict, but at the moment, it really is a guessing game. Those looking to buy or sell this year should keep a close eye on things.
Generally, the market has been shored up by low mortgage rates, powerful employment, absence of stock and Assistance to purchase in what has become a weak, needs-driven purchasers market, which is improbably to alter into early 2019 – Regardless of Brexit.