A few weeks ago I gave you a round up of the Kent Property Market Report. If you didn’t read it, please do. There were a few points I wanted to dig into more, especially the Brexit effect on the Medway market.
With the Brexit deadline of 29th March fast approaching, the PM surviving a vote of no confidence and a Brexit deal still not nailed down, property owners continue to worry how about leaving the European Union will have an impact on house prices. I’ve read a LOT of articles and underneath the scaremongering headlines, there are some important messages to highlight and even some positives to draw upon.
Firstly the buyers market is still strong. Nationally, the number of people registering to buy a home was up 37% on the year. Ok, they may be holding their nerve and not taking action until the Brexit outcome is determined, but the interest is there nonetheless. Paul Smith, chief executive of estate agency Haart, said, “the level of activity our branches are experiencing on the ground continues to defy Brexit doom-mongers’ expectations.” He was quoted in a This is Money interview as saying, “we could expect a super-charged property market in 2019 if a positive Brexit deal is agreed.”
And if it’s not? A no-deal Brexit is undoubtedly the outcome most feared, but it is largely anticipated to deliver a ‘short term blow’ to the housing market. A market crash is not anticipated should it happen. The transition from March next year until December 2020 as we leave the EU will be a fundamental period of time. During that time it is thought that the market will soften further and the pound will dip but as stated in the Kent Property Market Report, “the UK economy has proved relatively resilient over the last 12 months despite the backdrop of uncertainty around Brexit and the prospect of trade wars. Overall economic output is expected to show growth around 1.4% for 2018 as a whole.” Foreign investment into the UK housing market could be an unexpected positive that could help. While domestic buyers are trepidatious, foreign investors could ramp up and keep the market afloat while the pound has time to recover.
While we all wait with baited breath as the outcome of Brexit is determined, the summary is that it’s unlikely there will be any huge fluctuations in the market. Meanwhile the scary headlines continue; ones like the The Royal Institution of Chartered Surveyors (RICS) stating its house price balance sank to -11 in November from -10 in October, its lowest since September 2012. Of course that’s worrying but dig a little deeper and you find that HM Revenue & Customs figures show transactions rose by 0.9% in the same month:
A BBC article last week led with “Brexit Gloom” in the headline. But buried in the detail, it was stated that prices will still rise by 1% in 2019. Maybe I’m just a person that focuses on positives. I know the uncertainty is disconcerting, but there are always challenges in our market and with our economy, so I believe we can weather the storm. If you’d like a more specific indicator of what’s happening to house prices in Medway, the Kent Property Market Report showed we have the second highest growth rate in house prices in Kent, with an annual growth rate of 11.5%:
It’s not just Mrs May holding her nerve, the whole market is waiting for this outcome but for me it’s with keen interest not with terror filled nightmares. How do you feel about it? Message me on LinkedIn or Facebook if you have a different view or like me, are just keen to see an outcome come to fruition.