The Post-Brexit property market & house prices - the future?
At Robert Bell & Company it is just business as usual Post-Brexit!
Following the EU referendum result, the Bank of England has kept interest rates at 0.5 per cent, indicating that they consider the economy and housing market is ’at present’ stronger than expected. However, it is expected that they will cut rates in August as they expect to see a noticeable weakening in the market as we move forward over the next few weeks.
Whilst there are signs in London and the south that prices are weakening, there is no concerted evidence as yet to show that this is starting to happen in Lincolnshire. At present, any home brought to the market in our region by a motivated seller, which has been 'sensibly priced' by an agent, will sell promptly. We have not seen drop in demand.
Many ‘experts’ have predicted that there will be a slowdown in house price growth over the next couple of years, with falls nationwide drops of around five per cent - and more in London. However, it's still too early to determine what the medium and long-term impact of Brexit will be on the house prices. However, Rightmove's most recent monthly house price report, which covered the four-week period before and after the EU referendum, revealed that the housing market across England and Wales has remained relatively steady when compared to the same period in previous years, backing up our view that we have seen no significant difference between the pre and post referendum market conditions in the county as yet.
Is now a good time to sell? July marks the start of the seasonal holiday summer slowdown in the housing market, which picks up again in September. However, there is still strong demand from buyers and a shortage of homes, so properties for sale at realistic prices are selling promptly, but those which have been priced generously, will sit. This is why professional pricing advice from one of our expert valuers on setting an asking price when you come to sell is essential.
We have seen only one buyer attempt to renegotiate the price they have offered for a property. This was rejected and we have moved on to subsequently negotiate a sale, to the delight of all parties. This shows that Brexit has had little impact on buyers and sellers, and they have a desire to move."
Rightmove director Miles Shipside believes pitching your asking price too high would be counter-productive in the current environment. He says: "Buyer affordability is already stretched and they will be looking for extra reassurance that they’re getting the best priced home to suit their needs. Pricing competitively will tempt buyers, some of whom are sitting on their hands."
What is likely to happen to the property market if the Bank of England does cut the interest rates in August? Homeowners already on tracker mortgages will be the immediate winners, with the Council for Mortgage Lenders reporting that on an average mortgage of £114,000, the cut would be worth about £15 a month.
While confidence has been unsettled, the governmental instability in the few days after the referendum is now at last starting to be addressed. As has been commented by Rightmove this month, we are not in a new credit crunch and the effect of Brexit on banks and mortgage lending should be limited. As long as lenders keep mortgage deals attractive and available, the underlying demand for home-ownership should overcome most uncertainties.
So, at Robert Bell & Company our message is – ‘keep calm and carry on’! This summer there are still buyers out there wanting to buy and sellers who want to sell despite all that is going on around Brexit and the economy.
Tony Wing DipSurv MRICS FNAEA
Sales Director
Lincoln Office
Email: tonywing@robert-bell.org
Tel: 01522 538888
Twitter: @robertbellandco
