We live in crazy times. Almost 3 years after the country voted to leave the EU, the Brexit process continues to drag on and with no deal on the table, emotions are running high across the nation: anger, embarrassment, frustration, humiliation and boredom to name but a few. And we’re still none the wiser.
On top of the endless daily, if not hourly, updates on the process and it’s seeming lack of progress, we’ve also got the media reports about the NHS stockpiling medicines and bodybags and Joe Public panic-purchasing ridiculous quantities of toilet roll and tinned food as the prospect of a no-deal Brexit has continued to rise.
Banking, business and trading aside, where does all this leave the UK property market?
As the nation continues to wait with baited breath on the outcome of Brexit, we’ve taken a closer look at the impact on the UK housing market since the referendum.
House Prices, Growth Rates & First Time Buyers
Despite rumours of a slump in house prices, Nationwide property price performance figures over the last 3 years actually show a mixed picture: London, often considered the driving force behind house growth across the country, has certainly seen property prices stagnate, but some experts argue the plateauing has been as much down to the stamp duty increases introduced in April 16 and lack of affordability as Brexit. Other areas, conversely, such as Wales and Northern Ireland, have seen significant price increases year on year.
More recent reports show house price growth having fallen to its lowest level since 2013, but the decline in the capital’s house prices will have contributed to this downturn.
Further analysis by banking trade body UK Finance, which perhaps adds more confusion to the overall picture, indicates that the first-time buyer market is booming despite the Brexit uncertainty, with over 25,000 first-time buyers taking a mortgage out in January this year, an increase of 4.6% compared to January 2018.
What do the experts say?
Property experts seem divided on their opinions: partially subject to the timeframe over which they’re analysing retrospective figures and trends and partially subject to the potential Brexit deals that are still up in the air.
In November 2018, Mark Carney, governor of the Bank of England, warned that a no-deal Brexit could trigger a worse recession than the financial crisis in 2008, causing house prices to drop by up to 30%.
However, if a Brexit deal of sorts can be agreed, industry experts are cautiously optimistic, with The Week reporting that Russell Galley, MD at Halifax said “We expect annual house price growth nationally to be in the range of 2% to 4% by the end of 2019” and Surrenden Invest’s MD Jonathan Stephens arguing “it’s unlikely that the UK’s exit from the EU will trigger a housing market crash”.
What will happen to the housing market post Brexit?
It’s the million-dollar question but sadly, the bottom line is: no one knows.
In the absence of a crystal ball and any definitive answer, many people are ‘keeping calm and carrying on’. We are British after all!
If you are currently buying, selling or looking to remortgage, our advice is to keep an eye on the market and seek specialist financial advice – using the services of a broker or adviser can help with accessing the best mortgage deals, improving applications and speeding up the process. Which? can be a good starting point.
Simple, stress-free conveyancing
It’s a good idea to be prepared for the conveyancing process so it can progress as swiftly and smoothly as possible – our Property Fact Sheets provide a useful guide to the buying and selling processes as well as top tips to help you get your ducks lined up.
Identifying the right solicitor to handle your conveyancing is also key – if you need specialist legal advice or would like a chat about your property, please contact either myself or John Spittle on 01606 48777.