The latest Nationwide survey of prices shows that they edged up 0.6 per cent between July and August, bringing the annual rate up to 5.6 per cent
House prices have not dropped off a cliff following the Brexit vote. The latest Nationwide survey of prices shows that they edged up 0.6 per cent between July and August, bringing the annual rate up to 5.6 per cent.
Alex Thorpe, managing director of the estate agent comparison site netanagent.com, says the lack of an immediate property market reaction to the Brexit vote is because that relies on sentiment. And sentiment is positive.
“Despite warnings pre-Brexit, we have seen homeowner confidence remain steady,” he comments. “It’s easy to ignore the fact that there are a large number of people in the UK who believe Brexit will benefit the nation and, whilst predictions have been dire, we’ve seen property listings and valuation requests on site remain stable, with little to no impact on our business.”
In fact, the company recently surveyed 1,000 UK homeowners and found that 40 per cent believe Brexit will not affect property value, while 5 per cent believe their home would increase in value specifically because of Brexit.
“There’s a quick jump to pin everything on Brexit, which is understandable, but it’s also too early. The data isn’t there to support a negative outcome and until it is – if it is – consumers will retain confidence.
“Whilst Brexit has the potential to develop into a strong headwind, we have three powerful tailwinds, namely mortgage availability which remains solid, high levels of employment, and a chronic lack of residential property stock. These three combined continue to drive the property market.”
Many analysts agree that the shortage of housing is bolstering the market, with some even suggesting it’s the only reason prices didn’t plummet as predicted. That may be good news for home owners but it’s likely to cause future problems for tenants and first-time buyers.
Ian Thomas, co-founder and director at online mortgage lender LendInvest, says: “That house prices went up last month, despite the post-Brexit uncertainty, is a reflection of the sharp imbalance between supply and demand of property in the UK.
“The House of Lords Select Committee on Economic Affairs suggested we need to build 300,000 homes a year to have a moderating effect on house prices, but last week’s housebuilding figures from the Department for Communities and Local Government show we are nowhere near that.”