People putting off plans to buy or sell chokes housing supply and generates pent up demand
New research from HomeOwners Alliance and BLP Insurance has found that over 1 million UK adults have shelved plans to purchase a new property because of the vote to leave the European Union.
According to the findings, the referendum result is just one of a number of factors leading increasing numbers of British homeowners to stay put rather than move property. The research found that over 7.5 million UK adults have put off plans to move this this year.
In addition to the perennial challenges around rising house prices (26%), increasing cost of living (25%) and difficulty securing a mortgage or re-mortgaging (25%), almost one in six (15%) of those who stated that they had put plans to move on hold said that the Brexit vote was behind their decision. Those in the North East (27%) and Northern Ireland (21%) were the most likely to have cancelled plans to move.
Paula Higgins, Chief Executive of the HomeOwners Alliance said: “Our research demonstrates that both first-time buyers and those who already own a home are choosing to play it safe in these uncertain times. With the government preparing to trigger Article 50 this week, we can expect further uncertainty in the market until the UK’s future relationship with Europe is more clearly defined. People putting off plans to buy or sell chokes housing supply and generates pent up demand. The housing market needs certainty in order to be able to function most efficiently.
The government could help to ameliorate the situation, by looking again at stamp duty. It remains stubbornly high and acts as a drag on the market. Reducing the burden for genuine owner-occupiers could really help to keep the market moving in these uncertain times.”
Kim Vernau, Chief Executive Officer of BLP Insurance, had this to say: “We’re at a critical juncture for the UK property industry as we await further clarity around the terms of the UK’s exit from EU. Purchasing a new home is one of the biggest decisions that an individual is ever likely to undertake, and this is only compounded by the fact that average house prices are continuing on their upward trajectory. It’s therefore not surprising that many people are putting their housing ambitions on hold amidst the prevailing uncertainty.”