It is not just the immigrants who were affected by Brexit, though most of them feared total displacement. A more serious concern is the possibility of drop in property prices after the mandate of the people that decided that the UK will exit from the European Union. However, in reality there have been no changes as Brexit has had little or no effect on property prices.
With homebuyers moving as they take up new jobs, or because some of the families are getting bigger, demand for property is set to remain firm and so are the property prices. The actual situation is that demand exceeds supply, and with not enough new houses being built, property values are set to peak in most areas, though at a slower pace, when compared to earlier trends.
Some other reasons throwing a spanner in the works include sluggish wage rates and the reluctance banks are showing in granting loans due to stiff mortgage regulations. Although this is a dampener as far as property prices are concerned, they won’t fall any further as well.
With Brexit negotiations still going on, and in case they turn positive, there should be some buoyancy in the economy, which could boost property prices at a faster rate than imagined by experts. Reports from the Royal Institution of Chartered Surveyors indicate that the property market is indeed a bit languid, thanks to the record low number of homes on the block. With hardly any takers, and uncertainty over the final outcome of Brexit, people are putting off property purchases for now.
According to Savills’ forecast, there could be a 15% drop in property prices come 2018, as compared to prices in 2017. However, this alone cannot cause the property prices to fall. Savills is also of the view that property prices are set to be sluggish until the end of this year, however the silver cloud for landlords is that prices could gradually rise by 12 to 13% over a 5-year period, which is some consolation.
On the whole, the timing of Article 50 seems to have been a coincidence with an all-round slowing down in the property market in several parts of London and some areas south of the U.K. While the north of England is witnessing soaring house prices (after a dull phase) the southern part of the country is yet to catch up. Yet another spoilsport seems to be the stamp duty system that has been subject to several adverse changes, and has probably pushed Brexit to the background.