The implications of the 2016 Brexit referendum continue to hold sway over the UK property market, with a new survey from Emoov providing some fascinating analysis.
Britain’s departure from the European Union at 11pm on 29 March 2019 continues to dominate the news agenda, with Prime Minister Theresa May having presented her Brexit deal to the country a few days ago. And it’s no different for the property industry, with the Emoov research showing a fractured, complicated picture at both a national and level.
House prices have risen by 9.3% since the referendum on 23 June 2016, and the survey asked whether respondents had expected it them to rise by this much after the vote. Nearly a quarter – 24% – said they didn’t know but 28% had believed property values would go up afterwards.
Interestingly, 21% felt that prices would have gone up by more, while 15% thought they would have dropped after the referendum.
What will UK’s departure from EU bring?
But what of the future? ‘Brexit uncertainty’ seems to be casting a shadow when it comes to the industry trying to plan for the immediate future, whether it be in house prices, building new homes or the rental market.
And the results of Emoov’s survey seem to reflect this. When asked about what Brexit will do to the market, 30% felt that prices would keep rising but close behind were 28% thinking they might flatline. A significant number – 26% – are not sure, 12% foresee a slight decrease and 4% fear a complete collapse.
Prices up by more in Leave areas than in Remain
Can any effects from the vote be measured? The average growth of house prices since the referendum in areas that voted Leave is 9.46% – marginally up on the national average. That figure drops to 5.05% in Remain-voting areas, but in London’s Remain districts prices have gone up by just 1.8%. Where Leave was the preferred option in the capital, prices have inched up by 6.2%.
Predictions of seismic change for the industry and the market in the aftermath of the 2016 vote have not played out, and Emoov CEO Russell Quirk foresees more of the ‘wait and see’ scenario.
“While Brexit uncertainty may have slowed the rate of price growth it’s clear that it isn’t causing the Armageddon-like scenario that many have prophesised, based both on historic data and the current majority sentiment of UK homeowners.
“Ironically it’s the areas with a Remain majority that have fared worse where house price growth is concerned.
“This could be coincidental, but it may also demonstrate a more business as usual attitude within the Leave majority markets, with those less phased about the implications of what they voted for stimulating both buyer demand and stock levels, while Remain areas are seeing both buyers and sellers still sat on the fence.
“The UK market has overcome far worse then it’s current predicament and will no doubt continue exceed expectations once our departure has been confirmed via Article 50.”