How Brexit Has Made Homeowners Turn to Quick House Sales
After three years of political back-and-forth, misinformation and numerous allegations of corruption, the UK is due to leave the EU on October 31. However, amid all the confusion and turmoil, it appears that homeowners are likely to be bearing the brunt of the economic damage for years to come.
What exactly is Brexit?
Brexit. A word that has only entered the lexicon in recent years, but whose consequences have propelled it to the forefront of the British collective conscious. But what exactly is Brexit?
Contrary to popular opinion, the anti-European sentiment held by many of those who voted to leave can trace its origins as far back as the years following the Second World War, as the more learned members of the British public found themselves becoming weary of the multinational financial, defences and trade organisations that had been set up to centralise power such as the European Union, North Atlantic Treaty Organization (NATO) and the International Monetary Fund (IMF)1.
For many Brits, this centralisation of power meant losing sovereignty and the ability for the UK to make its own rules.
The rise of such organisations was also paralleled by a rise in immigration over the latter half of the twentieth century as increased globalism saw many educated individuals seek employment in more developed countries than their own in the quest for a higher quality of life.
While most young people in Britain today enjoy a secular multicultural social scene, just fifty years prior, most of the British population had barely been exposed to immigrants of different races and cultures. Unsurprisingly, this provided all the ingredients for a rise in nationalist, bigoted styles of thought – especially in areas with low standards of education amongst the working classes. Furthermore, as the rise of immigration and the European Union coincided with one another, it was very easy for Brits to blame the latter for the former.
In reality, the rise of immigration was a direct result of increased political and business agreements between countries as well as cheaper travel options and the need for a larger workforce to help re-build the country and its economy once the war was over.2
By time the 1990s arrived, the British industrial and political landscape had changed massively. The closing of coal mines and the movement of jobs abroad that had previously provided work within the poorer areas of Britain saw a rise of anti-establishmentarianism become embedded in the minds of those who struggled in poverty.
As time passed, it became clear to many that the country had become London-centric, with many other areas left to continue their decline3. And as politicians and other wealthy investors centred their businesses around the capital, a new form of political figure began to emerge, happy to exploit those who failed to understand the relationship between the EU and the UK.
It was during this time that anti-EU politician and grass-roots campaign leader Nigel Farage began to see his profile gain inertia as he marketed himself to less affluent areas as ‘a people’s man’ who is less tied to the elite than the opposing politicians against whom he was competing.
Farage campaigned with others who shared his viewpoint -including the late Sir James Goldsmith – in an effort to direct public attention towards the growing issue of direct immigration within the Eurozone from less economically resilient countries who had recently joined the EU, while also drawing attention to the troubled economies of southern European countries such as Spain4.
During the early 2000s, the idea of leaving the EU began to really gain traction amongst those who felt disenfranchised by the European and British elites who they believed benefited from EU membership at the expense of those lower down on the social ladder.
This growing belief, coupled with multiple Parliamentary scandals, a paralysing economic depression and additional political pressure from the growing anti-EU sentiment within the various parties led to the fulfilment of a promise made by then-Prime Minister David Cameron to hold a referendum vote on EU membership 23 June 2016.
In the months leading up to the referendum, the public found themselves inundated with media campaigns and political rhetoric, with one in six Brits admitting that the divisive nature of the matter had created rifts between families and friends.5
When the results were announced, many were surprised to learn that the Leave campaign had been victorious – winning 52% of the counted votes. A large number of analysts believe that this was due to a lack of engagement with the referendum by pro-remain constituents, combined with a constant stream of misinformation by the Leave campaign that led to the historic decision.6
While the referendum was by no means legally-binding, the government felt obliged to begin the preparations to leave the European Union – much to the ire of the 48% who voted to remain.
Due to the political and economic fallout that grew in intensity over the next three years, as well as the failure by the Tory party to negotiate a trade deal with the EU before the deadline passed on March 31st, an extension for negotiations was granted until 31 October 2019.
In June 2019, Prime Minister Theresa May announced that she would be stepping down from her role, forcing a Tory leadership contest whose winner will be responsible for the continued Tory efforts to take the UK out of European Union.
How has Brexit affected the economy?
Since 2016, the UK economy has seen its growth rate stall. By 2018, first quarter reports by Reuters showed that the economy was between 1-1.5 per cent smaller than it would have been if the Brexit vote had failed. Although many analysts cite an estimated GDP fall of 2.5 per cent – placing it second to last in the G7 economy rankings, just above Italy7.
The UK has, however, enjoyed a huge drop in the rate of unemployment, hitting its lowest level since the 1970s. Unfortunately, those within the work and pensions sector admit that this has been heavily influenced by the increase of ‘zero-hour’ contracts whereby an individual can ‘technically’ be counted as employed, but without a contract that stipulates a minimum number of working hours per week8. This lack of dependable income has forced many Brits to seek second, or even third jobs to cover their monthly outgoings.
Wage growth has also slowed significantly as inflation grew way above the 2 per cent target set by the Bank of England7. This devaluation in currency cannot be entirely blamed on Brexit, as inflation has outgrown wages for decades, with younger generations finding it increasingly hard to build up their savings. However, the inflation rises have forced many households to extend their lines of credit from lenders merely to cover month-to-month expenses9. The economic impact of Brexit, nevertheless, has led the household sector into a net financial deficit for the first time since 19887
As many Brits are probably aware, much of the economic downfall has been centred in and around the capital. Since the days of Thatcher, the UK has positioned itself as a financial powerhouse, with London serving as a middleman between the US and European trade. Unfortunately, many of the multi-national companies, banks, and potential investors perceive Brexit to be a huge mistake that may affect their bottom line if the UK leaves the EU. This has led to numerous organisations re-structuring and moving their operations from London into the Republic of Ireland as well as mainland Europe to avoid the possibility of unwelcome tariffs.
With a lack of employment opportunities within these organisations, the capital has become a less attractive proposition for younger people who have recently graduated, while also forcing many established homeowners in London to find employment elsewhere.
Many companies – both national and international – have also moved their headquarters out of the capital, choosing to move north where land-rent is much cheaper. This increase of investment into cities that had previously been considered ‘secondary’ to London began to turn the commercial property market upside-down as northern towns started to flourish at the expense of the South.
The capital is also finding itself starved of investment, with the Bank of England admitting that before the referendum took place, they expected the economy to grow by 13 per cent between 2016 and 2018. As a result of the leave vote, however, investment in the UK grew by only 2 per cent in total, including a fall of 0.2 per cent between 2017 and 20187.
The signs that Brexit may well spell further disaster are also worryingly clear, with UK stocks becoming a less attractive investment within the FTSE250 in the US, falling by 0.3 per cent (an increase of 12 per cent in Sterling) – a figure that is dwarfed by other developed economies who have seen investment rise by 26 per cent7.
How has Brexit affected house sales and the housing market?
The British house market is entirely sustained by consumer confidence in the economy. Thanks to the fall in GDP, Brits are generally earning less than they would have if the Brexit vote was for remain. Since the vote, house price rises have started to falter, forcing many potential sellers to consider waiting until after the dust has settled before making any plans.
While employment is at its highest level for over 40 years, the continued effects of rapid inflation; the proliferation of zero-hour contracts and the static but overly expensive house prices thanks to years of growth in value have left a large percentage of individuals from Generation X, the Millennial generation, and Generation Z with very little chance of ever owning a home of their own. This has led to an increase in rental properties, and consequently, and increase in rental fees as landlords exploit the situation for further profit10. This hike in rental fees also swallows much more of the income from those within these generations – preventing them from building up savings.
For homeowners in the capital, the effects of Brexit have been startling, with a £40bn drop in property value increases between 2018 and 2019 according to recent data released by London-based agent Savills11.
“Given the extent to which London is [currently] priced relative to the rest of the country,” said Lucian Cook, director of residential research at Savills in July 2019, “the extent to which it had pulled away from the rest — the Brexit vote may well have been the catalyst for a shift in the market.”
It isn’t all doom and gloom, however, as thanks to the closing of the north-south divide in property values thanks to the aforementioned re-distribution of investment from the south to the north, the total value of housing stock across the UK has still increased by £243bn since 201611.
Unfortunately for the UK government, this increase is mainly a result of property value increases across Scotland and Wales7 – countries who have both expressed an interest in leaving the United Kingdom in the event of a no-deal Brexit.
What options do homeowners have amid Brexit?
While a large proportion of homeowners can sit back and watch the Brexit saga play-out, there are, unfortunately, many who will have no choice but to sell while the market is stagnant.
Employees who have been made redundant in the capital, for example, have found themselves needing to move cities to find another job. And as much of their equity is tied into their house, they need to sell their house in order to buy another.
While some individuals choose to commute, the increase in prices for train fares has made this an increasingly undesirable option.
Why are homeowners trying to sell before the Brexit deadline?
Those who own a property that they have considered selling for several years are now finding themselves between a rock and a hard place. As of mid-2019, the UK property market lies in favour of buyers12. So why are they so desperate to sell before the Brexit deadline?
The answer, it seems, is very simple. Fear.
Homeowners have seen the decrease in market activity in the years since the Brexit vote, as well as the falling sold house prices that have so far been concentrated in the south of England. For many of these individuals, they have already acknowledged that they have lost profit on their homes, but the fear that their home could lose even more value if the UK leaves the EU on 31 October encourages them to play their hand early.
This situation is not helped by the amount of misinformation being spread by the less-reputable members of the leave campaign, who believe that even an independent analyst’s estimate that the UK will be “worse-off” once Brexit is finalised is all part of a propaganda campaign by the UK and EU elite they refer to as ‘Project Fear’.
In reality, there is no easy answer to the question ‘Should I sell my house before Brexit?” as, in truth, those within the industry can only make educated guesses that often need revising thanks to the repeated changes in government policies and legislation related to the October deadline.
Luckily, there are always ways to sell a house – even in a stagnant market. And if the value is presently higher than it will be in the event of a no-deal Brexit, many homeowners believe that it is worth it.
So, how can these homeowners sell?
- They can choose to sell the traditional way via a high-street agent who is likely to have common knowledge of the area but will take a percentage of the agreed sale price.
- They can enlist the help of online estate agents, who offer flat-rate fees to lure customers away from their competitors. Although certain companies such as Zoopla and Purplebricks have been caught numerous times transgressing the guidelines set out by the Advertising Standards Authority in relation to false marketing claims as well as failing to disclose additional fees to their customers
- They can try to sell the house themselves privately, although this approach rarely leads to a profit comparable to that negotiated by a professional agent.
It is important to draw attention to the fact that although these methods will – more than likely – guarantee a sale, it is ultimately the strength of the market that governs the value of their home. This means that if they wish to sell their house within a short-time frame, they will most likely have to accept a purchase offer much lower than they anticipated.
Is there a faster way to sell a house?
There are always options for a homeowner if they wish to sell their house fast – no matter the location, situation or quality of construction – and this is via the use of private house buying companies who have the resources to purchase a home outright for cash. This method has increased in popularity over the last ten years as the need to move to a new house in pursuit of higher earnings has become a priority for a growing number of households.
Other options include the use of an auction, where a property can be placed on a ticket and bid for by prospective owners. Auctions are often used by property developers and landlords to find bargains that they can profit from by either ‘flipping’ the house, or by placing tenants inside once it is renovated.
While some sellers report excellent experiences within the auction world – there are yet more who are unable to sell for their reserve price, forcing them to either accept a substantially lower amount than they hoped – or withdrawing their property from the auction, whilst still being obliged to pay the auctioneer’s fees.
How will the property market react once Brexit is passed?
As mentioned earlier, the condition of the housing market – as well as the UK economy – once the Brexit deadline passes is not an estimate many experts are prepared to make publicly with making a disclaimer. There have been claims that the UK could face its greatest economic recession since the Second World War if it were to leave the EU with, or without, a deal as negotiations to arrange trade deals with other countries appear to be weakening13.
One thing that all analysts all agree upon, however, is that if Article 50 were to be withdrawn and Brexit cancelled, the British Pound would likely rise in value significantly amongst the other developed nations. Echoing this sentiment are the many international corporations that are still in the process of drawing up plans to withdraw and re-locate from the UK, stating that they may be willing to reverse their decision to leave.
Are you looking to sell your home before the Brexit deadline? Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property before it’s too late.
Sources and references:
1Friedman, G. (2016). 3 Reasons Brits Voted For Brexit. Available: https://www.forbes.com/sites/johnmauldin/2016/07/05/3-reasons-brits-voted-for-brexit/. Last accessed 9 July 2019.
2Yeo, C. (2017). Freedom of movement didn’t start with the EU – it’s the norm for Britain. Available: https://www.newstatesman.com/politics/staggers/2017/05/freedom-movement-didnt-start-eu-its-norm-britain. Last accessed 10 July 2019.
3The Economist. 2012. The Great Divide. [ONLINE] Available at: https://www.economist.com/britain/2012/09/15/the-great-divide. [Accessed 9 July 2019].
4Carter, Neil; Evans, Mark; Alderman, Keith; Gorham, Simon (1998). “Europe, Goldsmith and the Referendum Party”. Parliamentary Affairs. 51 (3). pp. 470–485.
5Mischke, J. (2019). Brexit has made Brits ‘angrier’ and ‘deeply divided’: survey. Available: https://www.politico.eu/article/brexit-has-made-brits-angrier-and-deeply-divided-survey-referendum/. Last accessed 9th July 2019.
6Cassidy, J. (2016). Why the Remain Campaign Lost the Brexit Vote. Available: Why the Remain Campaign Lost the Brexit Vote. Last accessed 9 July 2019.
7Giles, C. Fray, K. (2018). The UK economy since the Brexit vote — in 6 charts. Available: https://www.ft.com/content/cf51e840-7147-11e7-93ff-99f383b09ff9. Last accessed 9 Jul 2019.
8Trotman, A. (2015). Zero-hours contracts ‘save UK from eurozone levels of unemployment’. Available: https://www.telegraph.co.uk/finance/jobs/11435789/Zero-hours-contracts-save-UK-from-eurozone-levels-of-unemployment.html. Last accessed 9 July 2019.
9Burroughs, C. (2019). Companies are fleeing the UK no matter what happens with Brexit. Here’s all the damage that’s already been done. Available: https://www.businessinsider.com/brexit-damaged-city-of-london-2018-11?r=US&IR=T. Last accessed 9 July 2019.
10White, A. (2019). Renting in London forecast: Brexit uncertainty set to push average rents up faster than house prices by 2023. Available: https://www.homesandproperty.co.uk/property-news/renting/renting-london-forecast-brexit-uncertainty-will-push-rents-up-faster-than-house-prices-by-2023-a126901.html. Last accessed 9 July 2019.
11Pickford, J. (2019). London property values down £40bn in past year. Available: https://www.ft.com/content/3f105808-9e62-11e9-b8ce-8b459ed04726. Last accessed 9th July 2019.
12Collinson, P. (2019). UK house prices likely to keep falling for another six months. Available: https://www.theguardian.com/money/2019/apr/11/uk-house-prices-likely-to-keep-falling-for-another-six-months. Last accessed 9 July 2019.
13Chu, B. (2018). Brexit: UK could suffer devastating recession and worst economic slump since Second World War with ‘disorderly’ exit, Bank of England warns. Available: https://www.independent.co.uk/news/business/news/brexit-no-deal-latest-bank-of-england-warning-recession-financial-crisis-a8656561.html. Last accessed 9 July 2019.
How Will Brexit Affect House Prices In The UK?
As the UK passes the original deadline for Brexit, many industries continue to be affected by the ongoing confusion regarding the state of the markets if the country leaves the European Union. But how will Brexit affect house prices in the UK?
How does Brexit affect the property market?
The property market is heavily tied-in with the state of consumer confidence, which can be observed through historical data gathered during the recessions over the last 40 years. In the most recent recession over a decade ago, average sold house prices across the country fell by 20 per cent over 16 months, while house purchase transactions fell from 1.65 million per year, to 730,000 in 2009.
For many analysts, this recession – or the Financial Crisis as it became known – was the worst economic downturn for the UK since the days of the Great Depression. However, housing values were propped-up in the years following by wealthy foreign investors taking advantage of cheap property in the capital.
Unfortunately, in the time since, the London property bubble has started to burst as more and more companies have moved their headquarters to the EU mainland to avoid trading issues if Brexit goes ahead. It is, therefore, more likely that the housing market will suffer a decline greater than that of the Financial Crisis in the event of a negotiated deal with Brussels, or no deal at all.
Will Brexit cause house prices to crash?
Large numbers of property experts believe that the property market, along with many commercial businesses will be the first to experience a huge downtown as the government attempts to collaborate with other nations in an attempt to secure trade deals.
As retail and service providing businesses will lose money due to increased trade tariffs, it is more than likely that they will freeze pay rises, lay off staff and close the number of outlets from which they operate. This is likely to lead to a higher number of people being out of work or earning less than expected, so the rate of consumer spending is also likely to drop – and this includes large purchases such as houses.
What impact will Brexit have on property prices?
Many homeowners have situations arise that requires them to sell their house regardless of the market condition due to starting a new career, or simply due to ill health. But if the demand for houses drops, then those who are looking to sell their house fast will have to accept much lower offers if they wish to complete the transaction. If this occurs en-masse, then it is very likely that house prices will crash.
While it is impossible to calculate the fall in house prices in the event of a deal due to Theresa May’s inability to reach a consensus with the EU’s negotiators, banks believe that if we leave the EU without a deal then they would expect to see a fall of 30%, placing large swathes of the population into negative equity, quite possibly leading to another recession even worse than the Financial Crisis.
If you’re worried about the effects of Brexit on your house sale, why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property.
Estate agencies under fire for turning a blind eye to crime
Despite a strong belief that the estate agency industry is heavily regulated, the lack of oversight by many unregistered agents has forced the government to hand out fines to tackle the growing problem of money laundering.
While estate agents are hardly regarded as the most trustworthy of professionals by consumers and industry experts alike, large numbers of vendors who are looking to sell their home fast are often more than happy to hire an agency – with little research of their own – in the hopes of securing high sold house prices.
Unlike many financial businesses which require a prolonged vetting process designed to rout out applicants who could be considered morally flexible, anyone can set up an estate agency business with little more than a registration with HMRC and a redress scheme – potentially allowing anyone to become an estate agenct.
While this is not a massive issue in itself, these loose set of rules allow criminals to launder money gained through wrongdoing via real estate investment. An obvious example of this is the mass-purchasing of central London residences by Russian Oligarchs in an attempt to safeguard their finances.
The government introduced regulations and fines many years ago in order to curb the exploitation of agencies who fail to probe suspicious clients, and to prevent housing values being falsely inflated. And as a result of fifty spot-checks carried out by HMRC this year, so far there have been a worrying number of agencies hit with financial penalties for failing to register with, or for not adhering to the HMRC money-laundering regulatory scheme. The most high-profile of which has been Countrywide, who were last month hit with a fine of £215,000.
“Criminals who seek to use this country as a place to launder money should be in no doubt that they have nowhere to hide,” said Ben Wallace, Minister for National Security and Economic Crime.
Estate agents are a crucial line of defence against them and that’s why they’re under a legal – and moral – obligation to file a report when they spot something amiss. It’s wrong to think of money laundering as a victimless crime. Those with dirty cash to clean don’t just sit on it – they reinvest it in serious organised crime, from drug importation to child sexual exploitation, human trafficking and even terrorism.”
So how does this affect the average consumer? For buyers, as long as they have no nefarious plans for illegal investment then they need not worry as the regulations are there to help those who stay on the right side of the law. For sellers on the other hand, a failure to deal with a reputable estate agency who are willing to protect their interests can lead to a number of complications further down the line. For example, sellers who discover that their home has been purchased through money laundering schemes may find themselves out-of-pocket as money seized by the authorities can leave the status of the sold property in limbo as legal issues are resolved – a process that can take years.
Is it any wonder then that companies such as National Homebuyers are finding themselves inundated with vendors looking for fast house sales via a reputable company who can complete on a purchase in as little as two weeks?
Prefer to avoid estate agents? Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property.
Sellers in shock as asking prices fall to new lows
As fears regarding Brexit continue to affect the housing market, sellers are finding themselves having to continually reduce their asking prices in order to entice buyers – leading to the weakest market growth since 2010.
Whether you need to sell your house fast, or are happy to wait until the right offer comes along, all vendors are desperate to get the highest price for their home. Unfortunately, things don’t always work out that way, as changes within the economy as well as differing levels of enthusiasm from buyers throughout the year can force a seller to reduce their asking price to ensure a sale.
Thanks to the public insecurity regarding the upcoming Brexit deadline, along with growing levels of poverty as a result of the austerity measures introduced by the Tory government over the last eight years, the housing market is struggling to maintain momentum – and it appears to be the vendors that are bearing the brunt of the situation.
According to property portal Rightmove, the asking price of a UK home dropped by 3.2% between October and December, and consequently, house prices for the entire of 2018 only rose by 0.7% – far below the 2% per annum rise the majority of surveyors and valuers would expect in a healthy economy.
Certain government officials have voiced their concerns regarding the falling housing values and the knock-on effects that could arise if more homeowners decide to stay-put, instead or sizing up or down.
For example, industries that rely on new homeowners for their profits – such as DIY retailers and curtain, carpet and furniture manufacturers – could face a slowdown that would be unprecedented.
The fall in sold house prices appears to be centred around the south and south-east, where housing has become unaffordable for all but the most affluent individuals in recent years. With the capital facing many potential setbacks in the upcoming months, however, as an increasing number of businesses threaten to relocate their headquarters elsewhere in Europe if no trade deal is in place by March 29th, those who have bought in the last 12 months in the worse affected areas may find themselves in negative equity as values slump.
“It’s usual for new-to-the-market sellers to price lower in the run-up to Christmas to tempt distracted buyers, so we should not read too much into the mere fact of two consecutive monthly falls,” said Miles Shipside, a Rightmove director and housing market analyst.
“However, these falls have been larger than usual, making this the largest fall over two months for six years, showing that there are more than just seasonal forces at play.”
It is, nevertheless, important to remember that if you do need to sell your house in as shorter time as possible, it is always worth contacting National Homebuyers who are willing to buy any house, regardless of market strength or condition.
Not getting the asking price you’re looking for? Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property.
Crisis As New Mortgage Deposits Unaffordable For First Time Buyers
As rental fees continue to rise, the additional costs to tenants is forcing those who may once have been prospective buyers to put their lives on hold as they struggle to find the money for a mortgage deposit.
The issues facing those living in rented accommodation across the UK have been well documented in recent years. But as austerity measures continue for the majority of Brits – despite the promises made in the recent budget – it’s clear that there is no end in sight for the misery felt by millions stuck in the rental trap.
Moreover, there also appears to be a growing divide between different regions of the country in regard to the amount of rent paid by tenants according to a recent study by Your Move.
While certain areas such as London, Wales, and the north east saw a slight fall in rental costs over the last 12 months, the average rent paid by tenants across England and Wales still rose by 2.6% versus the same time last year.
The data released also showed that while the demand by prospective tenants for rental properties has sharply increased, the number of properties available to rent has fallen.
This may be due to the fact individuals are choosing to stay in situ for longer instead of moving house, but analysts believe the more likely explanation is that the changes made to both capital gains tax and stamp duty by the Tory government over the last three years have caused large numbers of landlords to exit the property business and sell their assets in order to take advantage of the continually rising sold house prices.
“To put tenants back in the driving seat, we need more homes available to rent,” said David Cox, chief executive of ARLA Propertymark.
“And the only way this will be achieved is if the Government makes the market more attractive for buy-to-let investors.”
According to the Royal Institution of Chartered Surveyors, rents are due to increase over the next five years by three per cent a year, while housing values are expected to rise by two per cent a year.
Of course, these higher rental costs have a knock-on effect that can affect those who wish to sell their house fast, as renters who are who trying to buy their own home are finding it harder and harder to save the necessary deposit, leaving a smaller pool of buyers and therefore less competition for the availability homes – often leading to lower offers. However, those who need to sell fast can always contact National Homebuyers, who are always happy to offer competitive quotes for any house, regardless of situation or location.
Are you unable to sell? Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property.
The Top Ten Worst Places To Sell a Home In The UK
No matter the quality or condition of a home, if it is located in an area that offers little in terms of services or personal safety then the vendor will always find themselves consistently lowering their asking price in desperation to complete a sale.
If you’re browsing through listings on an online portal such as Rightmove, you will occasionally see a beautiful property for a staggeringly low price. Opening the listing, you remain optimistic but cautious as to why such a wonderful example of a home can be so cheap despite its large open rooms and well maintained exterior, so after a period of reflection you decide to contact the agent to arrange a viewing.
As you approach the house, it slowly dawns on you why the vendor is having such a hard time selling. For starters, there doesn’t appear to be any local amenities or shops within a 2-3 mile radius – so if the new owner wishes to pick up a few essentials, it would be necessary to catch a bus or drive. Secondly, the neighbourhood appears to have high levels of crime – a deal-breaker for most of us. And once you finally go inside, you hear the dreaded words “I’m afraid we don’t have broadband available in this part of town”.
In the UK, there are many places that buyers would prefer to avoid, and as a result National Homebuyers have been inundated by vendors who need to sell their house fast. Luckily, National Homebuyers will buy any home regardless of location with competitive quotes and industry leading service – but where are the worst places to sell a home in the UK?
This year, Home.co.uk compared data from sales across the nation, presenting a list of the areas where a house sale can turn into a nightmare that never ends, along with the average time it can take to sell:
1. Rotherham –279 days
2. Knightsbridge – 277 days
3. Sunderland – 277 days
4. Mayfair – 272 days
5. North Shields – 268 days
6. Marylebone – 268 days
7. Soho – 266 days
8. Charing Cross – 265 days
9. South Shields – 264 days
10. Strand – 262 days
Perhaps the most shocking thing regarding the list is the number of London boroughs. Many of these boroughs were in great demand just five years ago, but thanks to rising sold house prices, higher taxes and low wage levels, sellers who refuse to lower their asking price are finding themselves on the market for nine months or more.
Another interesting point is how few northerly towns are included in the list versus similar previous surveys. Analysts believe that the relocation of big companies such as the BBC to large northern cities with lower land values has had a positive effect on neighbouring towns as commuters vie for the best available properties.
With limited trade and falling levels of available industrial work, it is unsurprising to learn that other than the six areas near the capital, three out of the four remaining places on the list are occupied by towns from the north-east.
However, first prize goes to the large South Yorkshire town of Rotherham where houses take, on average, 279 days to sell. With high levels of crimes and the proliferation of ‘grooming’ gangs, combined with high rates of binge drinking and drug abuse within its population, Rotherham often finds itself named on humorous websites as one of the ‘worst places to live in the UK’.
While these lists do change as time passes with the rise and fall of local economies, it is clear that the economic downturn and public insecurity concerning Brexit has had far-reaching consequences for vendors up and down the country – even in the capital.
Are you unable to sell? Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property.
Councils under fire for banking unspent public funds
A number of councils across the UK have found themselves at the centre of a fresh scandal thanks to the discovery of large amounts of public cash meant for spending on infrastructure residing untouched in their bank accounts.
When the Town & Country Planning Act came into force in 1990, there was a minor piece of legislation included known as Section 106, which allowed councils to take vast sums of money from private contractors in exchange for planning permission within the boundaries established by the local planning authority. These Section 106 Agreements were often open to interpretation as a result of the lack of specificity, and so these were amended and clarified in 2010 to ensure that the system could not be exploited through previously known loopholes.
The key point of Section 106 agreements however, were to ensure that the money earnt by councils would be re-introduced back into the local economy in the form of affordable housing, and various infrastructure maintenance.
Worryingly, reports have emerged that a number of councils have collectively been hoarding over £375m in cash donated as a part of these agreements, with one council – Labour’s Southwark constituency – holding a shocking £52.6m alone.
Many of the councils implicated in the scandal have claimed that the money itself has already been earmarked for various schemes – but journalists looking into the matter have found that over 60% of that money is yet to be designated for use within potential projects.
“It is deeply concerning that councils in England and Wales are sitting on a pot worth hundreds of millions specifically earmarked for affordable housing,” said James Prestwich, Head of Policy at the National Housing Federation.
“This reconfirms our view that affordable housing should be delivered within new developments, rather than developers simply funding its delivery elsewhere. This would guarantee that affordable housing will be built alongside other homes within the same development, rather than the money getting lost in the long, bureaucratic process of allocating it for housing elsewhere.”
The issue of unspent public cash residing in private banks appears to be the latest in a long line of faux pas by local governments in relation to their control of housebuilding companies. As recently as this year, a number of prominent constructors including Barrett, Tayler Whimpey and Persimmon have been accused of purchasing land for housing, then holding back on development in an effort to keep sold house prices high.
This continued drive to push up house prices may seem great for those who own, but if they need to sell their house fast, they may find that prices have risen to a point where their asking price is outside the realms of affordability for many potential buyers.
Can’t sell your home? Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property.
Vendors cutting prices to encourage sales
As insecurity regarding the outcome of the UK’s planned exit from EU continues, vendors are slashing their prices to increase the likelihood of a sale.
Vendors across the country are slashing their asking prices in an effort to sell their homes fast, as fears grow that once Article 50 has been finalised, the value of their home may be even lower.
For London-based properties, the discounts have been stark. In prosperous areas such as Kingston and Richmond, vendors have cut their asking prices by an average of £84,244. While these reductions are smaller in size than those recorded after the financial crisis over a decade ago, they remain over 6% higher than those recorded prior to the EU referendum.
The online property portal Zoopla claims that around half of all properties in wealthy areas around London and Surrey have had their asking prices reduced under the advice of their agents in order to remain competitive. While this is good news for buyers who have the available funds to buy these discounted properties, it is bad news for both sellers and the property industry as a whole.
For an industry built on consumer confidence, such huge reductions in value are likely to put-off any homeowners considering selling their home in the short-term and instead encourage them to either place their home on the rental market, or stay-put until the market has recovered post-Brexit – assuming that it does.
The average reduction across the UK currently stands at £25,562, but with wage increases failing to meet expectations, those looking to buy their first homes are still unlikely to be able to take advantage. And while house values in general are still on the rise – albeit at a much slower rate than before – many analysts and economists are understandably weary regarding the robustness of the UK’s economy by the end of 2018.
“We see house prices rising a modest 2-3% in 2018,” said Howard Archer, chief economic adviser to the forecasting group, the EY Item Club.
“The fundamentals for house buyers are likely to remain challenging over the coming months with consumers’ purchasing power continuing to be squeezed by inflation running higher than earnings growth. Additionally, housing market activity is likely to be hampered by fragile consumer confidence and a limited willingness to engage in major transactions.”
For many owners who need to sell, the current outlook appears to be a no-win situation without an element of luck – especially taking into account the interest rate hike in November that appears to have further dissuaded potential buyers. However, by using a company such as National Homebuyers, vendors can sell their homes for competitive prices before their values fall further.
Are you worried about selling your home? Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property.
People could save £450,000 (60%) on the average cost of a house by simply moving out of London
According to research by Lloyds bank, people working in London could save themselves almost £450,000 or 60% on the cost of a house if they chose to live outside of the city and commute into London every day.
The study shows that average house prices drop by 60% from £741,919 in central London to £294,903 in towns such as Wellingborough and Chatham that are only an hour away from London.
Lloyds continue to say that even when taking into account the typical annual rail cost for a one-hour daily commute each way at £4,989, a commuter would have to make the same journey for 89 years for the total rail costs to wipe out the benefit in house prices.
The top 5 most affordable commuter towns outside of London for house prices are:
⦁ Wellingborough in Northamptonshire
⦁ Peterborough in Cambridgeshire
⦁ Kettering in Northamptonshire
⦁ Chatham in Kent
⦁ Swindon in Wiltshire
In Wellingborough in Northamptonshire is seen as the most affordable commuter town, where the average house price of £183,345 is 4.1 times the average annual earnings for central London workers. The next most affordable town outside of London is Peterborough in Cambridgeshire where the average house price is 4.2 times the typical annual earnings in London, at £189,319.
If you don’t wish to be that far from London, then towns such as Hatfield, Billericay, Orpington and Reading are only about 40 minutes away from London. In these towns you could potentially save 48% or £353,000 compared to London’s house prices. The average house prices in these towns is around £389,000 and with a lower average annual rail pass cost at £3,534.
Andrew Mason, Lloyds Bank mortgage products director, said:
“Commuters to London who don’t mind a longer journey between home and work could reap the financial benefits of living outside of the capital.”
“However, the decision of whether to live in the city or further away is not simply a trade-off between financial costs and journey times. Quality of life is also a major factor: family circumstances, better schools, physical environment and homes that offer better value for money also come into the equation,”
Mr Mason continued:
“That explains why, especially outside London, commuters are often prepared to pay a premium to commute when they could be better off in purely financial terms living closer to their place of work.”
Why not sell your London home and move outside of the city to save yourself a lot of money. Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property.
Why not check out our National Homebuyers reviews.
Is the end of the London property bubble nigh?
As forecasts for the capital’s property prices over the next two years appear bleak, will vendors find themselves with unmarketable property due to a lack of interest?
While the capital has always been considered an area of prime real estate, its exponential growth over the last 50 years has gone beyond what many in the property market consider normal. From those who managed to buy a property in London while the prices were somewhat affordable, to foreign investors who possess the financial clout needed to outbid others for in-demand homes in the most exclusive locales, homeowners in the capital have so far been happy to benefit from its ever increasing house prices.
However, there are signs that the tide is starting to turn, according to new figures released by top London-based estate agency Savills. While the rest of the country has recovered relatively gracefully from the ‘hiccup’ known as Brexit, London homeowners in vicinities such as Knightsbridge, Belgravia and Mayfair have continued to see prices fall – a fall which started over 18 months before the referendum was even announced.
Suffering from huge property tax increases, along with high-rate buy-to-let mortgages and costly second homes, the elite are seeing their dominance in the capital’s property market begin to slip.
With a 9% fall in prices to date since 2014, many investors are starting to feel the pinch of negative equity knocking at their doors – and if potential home buyers continue to rest on their laurels as opposed to blindly and confidently purchasing houses, in the custom which London property selling experts consider typical, the capital could start to see its downfall earlier than expected.
For the most part, central London has been a target for wealthy foreign investors – but their unwillingness to continue investing in the period of uncertainty following the UK’s planned exit from the EU has understandably caused a slowdown in the market, further compounding the woes already being felt.
Savills believes that these areas will not see an increase in investment for a further two years, until the EU talks are complete and Article 50 has been triggered. But with the HS2 rail link undermining the necessity for city-centre living as well as the growing number of companies moving to cities with cheaper costs, will it be too late for London to recover when all is said and done?
Those who need to sell in London don’t need to wait to for buyers if they decide to use a house buying company, who would be willing to buy any house for cash regardless of the state of the market for competitive fees – and with prices continuing to fall, avoiding traditional estate agencies may very well be the best way forward.
Worried that your London home won’t sell? Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property.
Why not check out our National Homebuyers reviews.
London’s property market finally starting to slow down
In London the median average salary is just £30,338 however if you wished to purchase a property in our country’s capital you will be looking at an average price tag of £522,000. House prices in London are almost actually three times the national average of £191,812.
This also means that London’s house prices are more than ten times peoples earnings. Wage growth in London is currently stagnant and isn’t keeping up with inflation and soaring house prices in the city.
The UK’s recent return to economic growth, high employment and persistently low interest rates, have all fuelled the growing house prices and to date it has been expected they will continue to rise relentlessly.
However in HSBC’s recent UK Housing Chartbook, the bank suggests that London’s soaring property market may actually be starting to slowdown.
The chart below, taken from data compiled by the Royal Institute of Chartered Surveyors (RICS), shows that London ranked second to bottom when it came to price growth in February.
The next chart, also sourced from RICS, shows that most regions in the UK are expecting to see house prices grow over the next 3 months, London will actually see a big drop into negative territory.
These charts, taken from HSBC’s report, show that London’s crazy rise in house prices is finally starting to lose its unstoppable momentum.
Rics chief economist, Simon Rubinsohn believes this drop in house prices in London will partially be the result of the UK’s introduction of an extra 3% tax on landlords and second home buyers.
Mr Rubinsohn said: “It is inevitable that over the coming months, April’s stamp duty changes will take a little of the heat out of the investor market.”
He went on to say “Anecdotal evidence suggests tax changes, concerns over Brexit and global economic uncertainty are all taking their toll on buyer sentiment in the capital.”
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Is London facing a mass exodus of homeowners?
Rising living costs and prohibitive transport prices are forcing young talent to rule out the capital as a prospective place to live and raise a family, eschewing the career benefits that the city offers.
It’s no secret that many view property prices in London as extortionate, with homes costing up to 13 times the average worker’s wage and skilled service workers having to work in the region of 14 years just to afford a deposit on a 60sqm house. For many decades, this has been an acceptable part of the capital’s lifestyle, where the benefits of job availability, high levels of pay and the ‘bragging rights’ of living at the epicentre of the international business world are worth the hassle of expensive living.
Recently, however, the tide has shown a change of direction – and the number of those leaving London to enjoy shorter commutes and cheaper living is rising rapidly. Even those whose families have lived in the capital for generations are upping sticks and fleeing to pastures new.
London itself has always attracted highly-skilled workers to help it solidify its position as the most successful city on the planet, but it is now facing a huge crisis, as those same workers are finding the living costs too much to bear. In a recent poll, four out of five Londoners in their twenties admitted to considering leaving the city for good, begging the question how long the capital will continue to function at such a high level if it can’t retain the best talent?
The greatest concern for attracting talent is that many younger people of child-rearing age are slowly realising that they would be unable to afford to raise a family in London, so would be forced to choose between their career and the urge to have children.
Another huge issue for those looking to move out of the capital is finding a UK homebuyer with the necessary wealth to afford their homes, along with the huge day-to-day expenditure the city requires. However, considering that many moving to the city are in house-sharing situations due to exorbitant rent prices, the pool of those wealthy enough to buy a London home is becoming smaller and smaller.
Of course, there are other options for sellers, such as house buying companies who can help those looking for a quick house sale and will buy any home for cash, but the continuing exodus of workers (63,000 families in 2015 alone) does not bode well for the city’s future – with Liverpool, Manchester and Birmingham-based companies offering similar career prospects but with a cheaper lifestyle and a shorter commute, leaving London facing the prospect of a talent vacuum.
Are you one of the many homeowners looking to sell your house quickly? Ask National Homebuyers for advice, as we guarantee to buy any home. Call 08000 443 911 or request a call back to find out how much you could get for your property.
Bomb Proof London Fort on River Thames on Sale for £500,000
In November this year an offer for a very unique building with an unforgettable address in London fell through. Now available to buy again No.1, The Thames (yes this is its real address) has come back onto the open market for £500,000. This property is a bomb proof fort situated in the Thames Estuary which is currently derelict but could be transformed into a seven-bedroom mansion.
The property’s location in Sheerness is within a 50 minute commute to central London. However that is if you own a speedboat because when the tide is high the property is surrounded by water. Only at low tide can you exit the property on foot wearily across a half mile muddy causeway.
The Fort is being sold by Simon Cooper, a London based builder at a price tag which is less than some one-bedroom flats in London. This unique building built in 1855 which has one of the finest addresses in London is being sold by River Homes who say on their website.
“The bomb-proof 150 year-old estuary gun emplacement is a kilometre off the Isle of Grain shore at the strategically important point where the Thames meets the Medway. The original tower is similar in design to the Martello towers which were first constructed as a defence against Napoleon in the early 19th Century. The property is of course in need of complete renovation (STPP) and includes land which runs from shore to and beyond the building as well as a good sized plot on land as well as deep water moorings.”
This property was featured in a BBC report when Gareth Furby took a tour of the Fort with estate agent Nigel Day – the report can be seen below:
We believe this Fort belongs more in the post apocalyptic movie Waterworld than it does in modern day London. So what could you do with such a unique building if you have a spare £½ million to buy it with. Yes you could turn it into an awesome seven bedroom house, but where’s the fun in that! Better to turn it into an exclusive night club only accessible by speedboat.
Or maybe your more ambitious and you want to start your own island society complete with micro economy or better still become you very own James Bond villain and turn it into your evil lure where you can conspire villainous plans. OK OK my imagination is running away with me now but the possibilities for this Fort are endless if you have the right amount of money and lets be honest who doesn’t want the best address in London.
This derelict property went on the market originally in October 2014 which means that it has been more then a year without a buyer so the longer it sits on the market the more money it is costing the current owner Simon Cooper. But there are options available for people in Mr Cooper’s position who have unique properties they are struggling to sell and that is to contact a UK cash property buyer like National Homebuyers who will buy the building outright for cash.
If you have had an offer fall through on your property or you have a property that has been on the market for a long time and you need to sell it fast then give National Homebuyers a ring on 08000 443 911 and we will buy your property regardless of its condition or location from you for cash in as little as 7 days.
If you would like to arrange a viewing of No.1, The Thames then click here – Arrange Viewing