With the EU referendum only one week away, we are receiving mixed feedback from estate agents as to what impact the upcoming vote is having on the UK property market.
While some are feeling a slow down as buyers aren’t keen to commit until a decision has been made, other are reporting business is booming.
In fact, a recent survey conducted by Relocation Agent Network mirrors this divide. The survey, completed amongst a network of Estate agents across England Wales and Scotland found that 53% of respondents indicated that the market trends they are currently seeing may be attributed to the upcoming EU referendum.
26% of respondents indicated that the most significant trend was a decrease in buyers which they thought could be attributed to the upcoming referendum, whereas 29% suggested it was a decrease in sellers.
Danny Luke, Managing Director of Quick Move Now comments;
There has been a huge amount of speculation about how the property market will be effected by the upcoming Euro Referendum……As is becoming apparent with the whole debate no one can really say as this is uncharted territory which is way too complicated to model with any certainty.
However I believe that certain outcomes are relatively likely depending which way the vote goes.
Starting with a leave vote. The UK property market is a truly international market, it has been widely reported that the uncertainty caused by a Brexit would reduce international investment in the short/medium term.
With less demand from international buyers, house prices would likely fall due to less competition. The effect would be most marked in London and SE but as has been seen before the ripple effect on confidence would impact the whole market. Depending on whether you’re are a home owner or buyer you may see falling prices as a bad or good thing.
Again there has been speculation on the impact of a Brexit on the availability and cost of mortgages. It is possible that bank interest rates would increase in an exit scenario making mortgages more expensive and difficult to secure.
However to compound this the banks and their surveyors will be nervous about the uncertainty and potential for house price falls, this will result in lower LTV and lower valuations which could be self-fulling in creating or extenuating a house price crash.
Then we have the likely impact of a stay vote. We have seen some buyers/sellers holding off on finalising decisions/purchases until the results of the vote are in, so expect a mini spike it demand and prices if the vote is to stay. However once that has happened we’d likely return to the current situation of demand outweighing supply with large numbers of foreign buyer mixed with local demand driving up prices.
So an in vote will likely be a case of business as usual and an out vote a medium term fall in house prices, maybe a positive or negative depending on your outlook/aims. However in long run I think that the property market in UK is really struggling with bigger problems than being in or out of Europe.
I think that everyone would agree that population size will increase whether we are in/out and that demand for property will increase. Governments from all sides have failed over 50 years to encourage or facilitate enough properties to be built to satisfy rising demand. Unless we build the type of houses people want in the areas they want them then we will see big boom/bust cycles with prices rapidly increasing over the long term.
If you need to sell your house quickly and can’t wait for the uncertain times to pass, Quick Move Now can directly purchase your property in as little as 7 days. We take on any risks involved with the resale, leaving you free to move on with the next stage of your life.
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