What’ll happen to UK house prices post Brexit
We seem to be fixated on property values here in the UK – they’re the subject of so many of our newspaper headlines, and of course, they have continued to be so since the surprise news in June that the British electorate had voted to leave the European Union.
But what difference is the country’s impending departure likely to make to British property prices going forward? We thought we’d take a closer look at the evidence.
Analysts predict muted growth in 2017 and 2018
The news agency Reuters recently conducted a poll of property market analysts, who predicted a 2% rise in UK property prices next year – only about half the growth that had been predicted back in June on the basis of Britain remaining in the EU.
However, as reported by The Week, these growth forecasts were more optimistic than the results of a similar survey in August, with house prices now expected to rise by 2.7% in 2018, compared to the 2.4% predicted a few months ago.
A trend of increasing property market optimism
Given then-Chancellor George Osborne’s suggestion in May that the two years following a ‘leave’ vote could see house prices collapse by 18%, modest growth throughout next year would represent a dramatically more positive result for the housing market than some had expected just a few months ago.
As IHS Markit’s Howard Archer has observed, “It is likely that any downside for house prices will be limited markedly by a shortage of houses for sale”, and with the initial shock of the referendum result having long passed, it seems that any first-time buyers hoping for massive falls will be disappointed.
What is the picture in London?
London – which overwhelmingly voted to remain in the EU – has unquestionably been the harshest-hit part of the country on the house prices front, with estate agent Knight Frank stating that values had dropped by 7% this year in prime parts of the capital like Notting Hill, Kensington and Chelsea.
As reported by The Independent, analysts Hometrack found that the capital’s property values as a whole had edged up by 0.9% in the three months to the end of September, which was well shy of the 3% average recorded over the previous three years. It means that the average London home now costs £480,500. Meanwhile, according to The Week, analysts have predicted a 0.5% fall in London house prices in 2017.
Now could be a great time to enter the market
With the house price figures for the months immediately following Brexit suggesting that values will continue their upward march in much of the UK – albeit at a slightly slower pace than if the country had voted to remain in the EU – now could be a very good time to buy or sell a property.
Record low mortgage rates are making the current moment an especially attractive time to purchase property. If you have inherited a house from a deceased loved one and would like to make a quick, discreet sale that will enable you to commit to the purchase of a new property, simply talk to our team here at Probate Purchasers today.