Housing market crash as Brexit hits home
After a tumultuous few weeks of negotiations, the reality of Brexit and how it will affect the UK economy if we leave the EU without a deal has led to the worst sales slump in the housing market since 2012.
When the Brexit referendum was announced, many saw it as an attempt by then PM David Cameron to silence the Euro-sceptics within the government once and for all. However, thanks to false claims regarding funding, a lack of understanding in regard to how the Single Market functioned between member states and a general lack of support for the Tories, those hoping to leave the EU won the vote by an extremely narrow margin, much to the surprise of many remainers who felt the possibility of a win for the Brexiteers was unimaginable.
Flash-forward to the end of 2018 and the UK is less than four months away from reaching the deadline for Article 50, forcing the country out of the EU without a trade deal. A large swathe of the population are astonished that such little progress has been made over the last two and a half years, but most of those who voted to remain have always been aware that Theresa May’s Chequers deal – which keeps the UK in the EU in every way but name – was the best deal the country was likely to get given the requirements of the Single Market laid out by Brussels at the beginning of the Brexit process.
While support for a no-deal Brexit continues to enjoy a prominent voice thanks to the vocal minority, it appears that the tide of public opinion has started to shift towards remaining in the EU as job losses and lower profits within the manufacturing and financial industries continue to mount – and this has all occurred before the country even leaves.
Sadly, the housing industry is not immune to the effects of Brexit either with sold house prices falling, along with decreasing levels of interest from purchasers. As a reference, new figures by NAEA Propertymark have shown that the UK has recorded the lowest number of potential buyers registering with Estate Agents since 2012.
“Last month’s findings prove that uncertainty surrounding Brexit is having an impact on the sector,” said Mark Hayward, Chief Executive at NAEA Propertymark.
“It’s possible that many buyers and sellers are putting their plans on hold while they wait for clarity on what the UK’s future relationship with the EU will mean for them and the property market.”
Another point of interest is that there has been a fall in mortgage completions by first-time buyers, movers and landlords according to UK Finance over the last 12 months. But what does this mean for vendors?
“With fewer prospective buyers interacting with the market, it’s important those currently trying to sell their home ensure it is priced competitively and is presented in the best possible way,” Mr Hayward added
A large number of sellers appear to be waiting and watching to find out whether Brexit goes ahead with a no deal – as May’s Chequers deal is unlikely to pass through Parliament on December 11th – or whether Article 50 will be revoked and we remain a part of the EU.
If the former comes to pass, it is likely that the economy – as well as housing values – will crash on a scale not seen since the Great Depression. If, however, the latter occurs and we remain in the EU, then the value of the Pound and the economy as a whole is expected to rebound massively – hopefully re-injecting some life into a housing market that, at the moment, is facing a worrying future.
Some vendors, however, have no choice but to sell their house fast, whether it be for a job or simply to move closer to loved ones, and may be forced to accept dishearteningly low offers in order to sell.
Despite the bleak outlook, there is always the option of contacting house buying companies such as National Homebuyers, who can complete a purchase in as little as two weeks as long as the seller is happy with the no obligation quote provided.
Need to sell before Brexit? 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.