Adam James, head of marketing for We Buy Any House
As the intricate web of Brexit and our departure from the EU still unravel, many are questioning 'what's next for the UK and its industry?' – None more so compared to property market.
But it's not only property industry experts that are worried. Very first time buyers, investors, and landlords are questioning whether now is a good time to maneuver, sell, or purchase with your uncertainty looming.
The best indication of what will happen in the coming months is exactly what has happened most recently. London's housing market has begun to freeze up, the effects which can be felt over the UK. Towards the end of 2022 we saw the market slow significantly, with lots of experts predicting a difficult 2022. A study conducted by the Royal Institute of Chartered Surveyors shows the housing market at its minimum since 2022. Another study on the Centre for Economics and Business Research found that properties in towns and cities in the united kingdom were left on the market for six days longer than these were in 2022.
Michael Patterson, CEO of We Buy Any House believes the lack of parallels with Brexit indicate a rocky road ahead: 'both domestic buyers and the significant interest fueled by overseas buyers would potentially dry out within a very short space of time as the market tries to readjust to some unknown position that has no previous parallels. We can expect significant confusion and history tells us that these days the home sector may be the one that takes the biggest hit.'
The rental marketplace is clearly being affected, too, having a recent report released from HomeLet showing that rents through the UK rose by 3.8% in February alone compared to this past year.
All of the suggests that the property market in 2022 is expected to become stagnant as buyers and sellers choose to sit tight until the Brexit mist has cleared. But is there any light at the end of the tunnel?
Some experts appear to think so.
A resolution of Brexit negotiations could behave as the catalyst for potential buyers and sellers to reenter the marketplace.
The housing market has always been able to weather both economic and political change, but often struggles when faced with uncertainty. Many say that we should be cautious of catastrophizing a no-deal Brexit and also the housing market. Even though it is likely going to have an impact, there are more factors at play that may try to mitigate any significant issues. Things like a stop by the need for sterling can often mean a loosening of policy helping drive up housing demand quickly. It is also worth remembering that buyers, providing they mitigate the risk, shouldn't fear a home price crash. Purchasing now could mean a drop in value on the temporary scale, but if you are planning to reside there, it would be expected that the market may have recovered when you decide to sell again.
Others believe that landlords with portfolios can steer a clear course through Brexit. The uncertainty around Brexit could lower the appeal from outside investors, pushing prices down creating ample opportunity to still add to their portfolio. Any landlord reliant on finance can experience a far more uncertain future, though.
Amadeus Wilson of SPF Private Clients: says: 'It is essential to consider your personal circumstances. If you need to move for work, schooling, or since you need a bigger home or are downsizing, and discover a house you wish to buy in a sensible price and can manage to achieve this, there seems little reason why you shouldn't go ahead.'