Here's my latest property price and rental updates which summarise and comment on all the indices produced each month.
The impact of Brexit on the property market is the big question everyone is trying to answer, especially after George Osborne threatened house price falls of 18% if people voted no!
In the main, most indices are reporting that it’s too early to tell what the main impact will be and for now, the research is giving mixed messages.
Rightmove gives a good lead indicator of the impact as it’s one of the first places buyers come to and sellers appear on. Their view is:-
“The summary so far based on two weeks of post-Brexit-vote statistics is that the housing market remains steady, underpinned by the same fundamentals that have led to its recovery since the last downturn.”
Nationwide, one of the UK’s biggest lenders suggest that:-
“It will be tempting for commentators to assign any trends in the coming months to the impact of the referendum. Housing market transactions were always likely to soften over the summer after the surge in activity in March, as buyers brought forward purchases of second homes to avoid the stamp duty levy, which took effect in April. Determining how much of any fall-back in activity is the result of the tax changes and how much is due to the referendum will be difficult.
Their confidence index does show however that the uncertainty over what happens next in the economy “may lead to weaker demand for homes. Leading indicators are consistent with softening ahead.”
The RICS provides useful insight into the market post the Brexit vote. Firstly they report that “instantly following the Brexit result, three in five (57 per cent) reported a drop in demand from prospective buyers and three in five (58 per cent) saw supply fall in the week immediately following the vote”.
Reports by their agents suggest that “activity has picked up after an initial wobble, while others cite the Brexit vote as having only a modest or even negligible impact thus far”.
The best and to some extent most comprehensive insight from the RICS is the market commentary at the end of the index from their surveyors, all of which show there is a mixed picture when it comes to the impact of Brexit:
RICS agents’ market comments:-
Douglas Farmer, Hopes Auction, Wigton: “Hiding behind Brexit is easy but there is still an air of uncertainty in the market.”
Simon Bainbridge, Savills, Darlington: “After some uncertainty post Brexit, the market has settled and confidence is returning.”
Simon Croft, Feather Smailes Scales, Harrogate: “Brexit has made no difference to the market in this area.”
Martin Pendered, Martin Pendered & Co, Wellingborough: “The impact of the referendum has been much less than expected, but this may be disguised by the holiday period but indications are that the market is still buoyant.”
Mike Arthan, Barbers, Shropshire: “July activity levels better than expected after Brexit vote.”
Richard Franklin, Franklin Gallimore, Tenbury Wells: “Stock levels low and inertia following Brexit are key features. Until the economic outlook becomes more certain, cannot see why aspirational purchasers would participate in current market.”
Guy Gowing, Arnolds Keys, Norfolk: “The immediate aftermath of the Brexit decision caused huge uncertainty and panic, however since the appointment of our new Prime Minister calm has been restored and its business as normal.”
Andrew Morgan, Morgan & Davies, Lampeter: “We expected less activity post Brexit result but to the contrary, the market has accepted this, with lifestyle buyers leading the charge to rural Wales.”
The main negative views seem to be London based:-
Kevin Ryan, Carter Jonas, Mayfair: “SDLT, ATED (Annual Tax on Enveloped Dwellings), the Brexit vote and the holiday period have combined to create the perfect storm of inactivity.”
Both LSL Acadata and Hometrack housing experts agree that it’s too early to tell what will happen with LSL saying:-
“There’s consensus in the housing market over Brexit: it’s still too early to tell what the long-term impact will be. While the vote to leave has definitely resulted in uncertainty, there’s near unanimity among commentators that the impact is yet to show in the figures….. external commentaries and the LSL Acadata HPI data suggest that any slow-down is unlikely to be of the scale suggested by HM Treasury in the run up to the vote……..”
While Hometrack conclude:-
“It is still very early days to assess the true impact of the EU referendum vote on activity and house prices. Hometrack's view, based on our Cities Index and analysis of listings data, remains that sales volumes are likely to slow and price growth will moderate over the second half of the year.”
For more information on what's happening to rents and prices, read my full reports:-