With Britain’s scheduled departure from the EU only weeks, every day new Brexit announcements are hitting the headlines and giving mixed messages about the UK housing market. Confused and in a state of flux, those looking to buy or sell a property are asking Leaders’ property experts: “Is now the right time to move house?”
Just this week property comparison site Rightmove reports that, amid Brexit uncertainty, it has seen the average asking price of properties new to the market drop by 0.2% - the first fall at this time of year since 2010. However, less than a month ago Rightmove said it had experienced a “pre-Brexit buying spree with agreed sales up by 6.1%” year on year.
At the same time, building society Nationwide suggests there was “little change in UK house price growth in August”, while the National Association of Estate Agents (NAEA) proposes that the “number of house hunters is on the rise as buyers look to complete sales pre-Brexit”. Confusing, wouldn’t you agree?
One reason behind the differing views, explains Kevin Shaw, Managing Director of Residential Sales at Leaders, is that some Brits are adopting a “see what happens” mind set about Brexit. This is leading them to hold off from buying or selling.
On the other hand, the NAEA has reported that some view the Brexit deadline as a catalyst to move right now, while the property they want to buy is available. Extremely low mortgage rates are also helping to reassure potential buyers that the property they want to purchase is good value.
Kevin says: “Some properties are selling almost immediately and securing a good price, particularly when buyers are competing to secure a home. Though others are taking a little while to sell, especially if they are priced higher than buyers are willing or able to commit to.”
What effect is Brexit really having on the housing market?
The one constant we do know about the property market is that people will always need to move, whether we achieve a smooth Brexit or not. Changes in personal circumstances, such as a getting married, having a new baby or simply needing more space as children grow up, are always going to be reasons to buy (and sell) property.
Looking towards market activity in autumn and beyond, Kevin expects one of two scenarios. “The first, and most likely, is that the current ‘bounce back’ continues up until Brexit - and even into the Christmas period, given that those who are keen to move while they have certainty will be joined by those who have perhaps held off for a while, but now desperately need to move due to personal circumstances.”
He believes this is even more likely if the latter have viewed properties they would have liked to buy being sold recently. “When another property that appeals to them comes onto the market, this time they are unlikely to want to miss out, especially with the additional incentive that they can lock in historically low-cost financing.“
In areas that have experienced a flurry of activity over the summer, however, things could slow down. For buyers this will result in more attractive prices, while sellers would feel reassured of a buyers’ commitment and there’ll be a lower chance of them pulling out once a deal has been agreed.
Should I move house now?
“If the time and circumstances are right for you, especially if you’ve found the property you want to live in, then it’s always a good idea to move – you don’t want to miss out on your dream home, afterall.”
Currently first-time buyers can get onto the ladder with a little less competition than there has been over the last few years. They also have the added benefit of being exempt from paying stamp duty if purchasing a property under the £300,000 threshold. While those selling a lower-value property and trading up to a more expensive one can actually save money if they secure a good price on their next home.
Typically, for those trading down, most will have seen good property price growth if they have lived in the property for a while. Their next move is more about getting the right property on the right street, next to much-needed amenities, rather being too concerned about price movements.
Of course, if the market does pick up over months to come, it will be good news for sellers - but will put rather more pressure on those buying to compete for properties for sale. This may potentially lead to prices rising a little higher than we have seen over the last 18 months.
“If you are thinking of moving, please do come and talk to us. We can explain the wide range of potential purchasers that we have looking for property at the moment, and whether your property is one that our clients will find appealing enough to purchase.”
Kevin adds: “Our job is to help give you a realistic picture of what’s happening in your individual property market, and to make sure that we guide you through the buying and selling process as smoothly as possible.”