What the experts are saying about Brexit and the housing market…
As the uncertainty around Brexit continues to drag on further and further into 2019, we thought we’d catch up on some reading around house prices, to try establish what home buyers and home sellers can expect as a result of Britain leaving the EU.
Now a “no deal” Brexit is looking more likely than ever, we recall the statement Bank of England Governor Mark Carney made in September of 2018, where he warned that a no deal Brexit could send house prices tumbling by as much as one third! Since then he has also added than UK growth would be “guaranteed” to fall in the event of a no deal. But Mark Carney is just one man…so what does the rest of the property market think will happen?
Well since the vote initially took place (way back in 2016), house prices did stagnate for a little while but as the Brexit deadline grew closer, that stagnation turned into more of a dip as we moved towards the end of 2018, falling further still at the start of 2019.
On top of that, sellers and estate agents are reporting that it’s also now taking longer to sell properties that it has done in previous years, and that could be the result of nervousness about Brexit. For even more detail (including some very useful graphs on how Brexit has already impacted the housing market for both better and for worse, we recommend reading this article from Which.co.uk
So that’s a very brief overview of what’s happened so far since Brexit, the more pressing question is what will happen next?
Well, drops in house prices could mean it’s turning into a buyers’ market, so there could be the opportunity to snag a deal as the Brexit uncertainty continues, although according to the experts many buyers are putting their plans on hold in the hope of further price drops. On top of that, actually finding the perfect home to buy could get trickier as many people are deciding to stay put in their current homes, until there is a clearer a picture of what’s going to happen next, so homeowners are dragging their heels just as much as buyers it seems!
On top of this, there are also warnings that getting a mortgage could become hard as a result of a no deal Brexit in particular. While interest rates would likely be cut in a no deal scenario, banks may also then be less willing to lend as the economic situation would be deemed risky. That means those who are brave enough to decide to buy regardless of Brexit may find it harder to do so.
If there are less people selling and less people buying (whatever the reason), it can generally be assumed that there could also then be greater pressure to reduce house prices overall. For even more insights into what a no deal Brexit could mean for the housing market, check out this post from Inews.co.uk