How has the election and Brexit affected the property market?
The summer months are one of the busiest times of year for people buying and selling and currently, it is difficult for property lawyers to see any negative effects of Brexit on a day to day basis, despite ongoing economic and political uncertainty.
So where are we with property prices? The ONS said that average house prices in the UK have increased by 5 per cent in the year to May 2017. This time last year, it was 1.2 per cent. ONS data also shows the average UK home price has risen by £12,000. These figures go against the reported post Brexit and election slowdowns.
There have been mixed reports so far this year and ONS have stated “there has been a general slowdown in the annual growth rate since mid-2016”. Some estate agents have reported slumping profits for the first six months of the year, blaming economic and political uncertainty, plus a lack of housing stock.
On the other hand, there have been reports of an increase of sales to first time buyers, and a rise in demand for property. Some estate agents have reported having more instructions post-election. Many buyers are carrying on regardless, with personal factors for moving being stronger than political ones.
It is difficult to see how the election has affected volumes of sales, as comparisons with this time last year are skewed from the stamp duty change in April 2016, causing a rush of sales to go through.
There are concerns that this extended ‘wait and see’ period, especially with house builders, will have a domino effect in years to come and it could be years before our housing supply increases. What is needed, is a ‘business is usual’ approach to counteract this happening and to keep the housing market healthy long-term.
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