It is widely expected that central prime property prices in London will be hit the hardest.
As a result of a Brexit vote, London could potentially lose its status as a safe haven for foreign investment. Foreign companies with European headquarters in the capital could also choose to relocate, reducing demand for both commercial and residential properties.
Donnell said: “House price growth is already weak and running in low single digits in central London areas and modest price falls now appear likely in higher value markets as prices adjust in the face of lower sales activity. Even a sharp fall in the sterling is unlikely to attract overseas buyers in the near term.”
Richard Adams, managing director of mortgage and protection network Stonebridge Group, said: “We still expect prime London prices to continue falling and many of the tens of thousands of luxury homes in the pipeline to be mothballed as demand from all over the world fails to meet that potential level of supply.
“The rest of London will definitely be hit by a perfect storm of several factors hitting house prices which is great news for house buyers but not for investors and homeowners.”
During the run-up to the referendum economists predicted that house prices could come crashing down in the event of a Brexit vote.
The International Monetary Fund said exiting the EU could send property prices plummeting while analysis by the Treasury showed that up to 18% could be knocked off the value of people’s homes.
So with house prices at record highs across the country, what can we expect to happen in response to the result of the referendum?
Richard Donnell, insight director at Hometrack, said that the near-term prospects for the UK housing market now look “very uncertain”.
He said: “The immediate impact is likely to be a fall in housing turnover and a rapid deceleration in house price growth as buyers adopt a wait and see the short term impact on financial markets and the economy at large.”