Post Brexit doom and gloom?
Wed 12 Oct 2016
Not at all according to Hunters Sales Director Martin Robinson who offers his views on how the property market has performed over recent months:
As we enter the last quarter of the year it is interesting to reflect on the year so far; one that has been full of distractions and uncertainties which can often be a distraction for people buying and selling property. Firstly we have had three major sporting events - European Football Cup and two Olympic Games, secondly an EU referendum followed by Brexit and thirdly a change of Prime Minister. All these are events could have understandably resulted in a lack of appetite for moving house and making investments as most events of national importance can do.
In reality however, this has certainly not been the case and despite the significant events we have seen unfold, the property market has held up well and much of the media driven ‘doom and gloom’ following Brexit has not happened. We have seen a business as usual scenario with very similar levels of agreed sales (outside London) to 2015 and sustainable single digit price increases. The driving factors still remain strong e.g. low interest rates and shortage of housing supply. As interest rates were cut from 0.5% to 0.25% in August, making mortgages cheaper, we have seen an increase in activity amongst first time buyers, further stimulating sales at all levels of the market. Equally, the lettings market has continued to see high levels of activity and strong demand.
Our predictions for the remainder of 2016 are that house prices will continue to rise at a sustainable level, more choice through new development schemes will help the general churn of the market for both sales and lettings; the weak pound will bring overseas investment back into the major cities and domestic investors will now start to return to the market as bricks and mortar still represents a very sound investment.
Speaking to several of our branches in London, market activity did see a drop in the period after the Brexit vote. Arguably this could also be related to the continued effects of the stamp duty changes for investors, a change in Prime Minister and the expected lull of the summer months. The London market certainly appears to have experienced a price correction situation with properties now selling at more sustainable market values; something that many agents argue was inevitable and expected. Sales activity levels are now reported as ‘back to normal’ with a significant increase in activity in September and October. The lettings market is reported to have continued to be very strong with high levels of activity over recent months.