Much has been written about the impact of the UK’s housing market that leaving the EU without a deal could send house prices tumbling by a third. Some regions have boomed, while foreign investors continue to keep faith in the UK.
In today’s blog, we bring you the insider’s guide to what expert from the estate agency think will happen over the coming months.
Many business leaders and financial experts have expressed concerns about the potential consequences of a no-deal Brexit. House prices did stagnate for a while. This could well have been down to the usual pattern of prices growing in spring and plateauing over summer, which we also saw in 2017. But, with Brexit looming ever closer, house prices suffered a bigger post-summer dip than usual in 2018, dropping from a peak of £232,797 in August to £230,630 in November.
Looking at year-on-year house price change over the longer term can be another useful way of understanding what the market’s doing. It has continued to decrease in England ever since However, there was more significant growth in Wales and Northern Ireland.
It’s worth bearing in mind that, even if the rate of growth has decreased, house prices themselves haven’t – and many argue that the slowdown in England is simply a long-overdue market correction.
Another way of judging the health of the housing market is to look at transaction volumes and Two commonly used measures of how the market is performing for sellers are stock per branch – which is the average amount of properties on each estate agency’s books – and time to sell.
Housing expert, Kate Faulkner said: ‘We’ve definitely seen a stagnation in the market over the last year in areas such as London, the South, and East (which had all overheated) and this slowdown has spread to other areas over the last few months. Buyers are holding back in the hope that prices will fall. But it’s not only demand that’s dropping – supply is, too, with many people battening down the hatches until we have a clearer picture of what’s going to happen. ‘This can limit the likelihood of decreasing house prices, but also mean that few moves, as there’s little choice on the market for would-be sellers.
However, if you’re considering buying somewhere for the short term it’s more complicated. Transactions are likely to drop over the next few months and it’s possible that interest rates could jump back to their pre-credit crunch levels of 6-7% if a no-deal Brexit causes issues.
In terms of the buy-to-let sector, demand from landlords has already reduced so it’s unlikely we’ll see further falls this year. And, while tenant fees are being banned from June, rents are likely to rise further due to lack of stock, meaning now isn’t a particularly bad time to be a landlord as long as you really understand your objectives and whether the deal stacks up both now and in the long run.’
As it stands, the only thing that’s clear is that nothing is clear, and you’d be justified in having no idea whether now is the right time to buy, move, invest or remortgage.