Brexit Causes Frosty Winter House Price Declines
The winter months are set to become increasingly frosty as experts predict house prices are set to decline by 1.3% over the next three months.
The data further speculated that some regions will fare considerably worse than others as Brexit deters buyers and sellers from entering the property market, according to Reallymoving.
The average house price in Northern Ireland is set to fall by 8.5% to £163,969 whilst Welsh property will also decrease by 8.4% causing the average house to be worth £177,205.
Even areas that have experienced moments of price buoyancy in recent months, like the North West and West Midlands, are set for declines of 5.1% and 4.1% respectively, effectively wiping out the gains made in the past 6 months.
Whilst political uncertainty has caused significant disruption to the housing market in 2019, new research has indicated that majority ‘leave-voting’ constituencies are successfully weathering the Brexit storm with average prices increasing by almost 10% since the 2016 referendum compared with little over 8% growth in majority leave areas, according to research by Propertunity.
Reallymoving data has also indicated that house prices have been a lot more resilient than originally thought and will end the year with annual UK increases of 4.1%, rising from £287,901 in December 2018 to £299,705 by the end of the year.
Rob Houghton, Chief Executive of Reallymoving, said:
“Most regions of the UK are set to see prices dip over the final quarter of the year which is partly down to seasonality as the market follows its usual pattern of peaking in the late summer/early autumn and then tailing off steadily towards the end of the year.
“It’s fair to say 2019 was never going to be a stellar year for the housing market but despite consumer confidence taking a battering, house prices in England and Wales are on course to end the year 4% higher than at the end of 2018, which supports our belief that the underlying value of property remains fundamentally stable.
“The political situation now is as uncertain as ever with a general election just a few weeks away, but the figures indicate that the market will continue bumping along in much the same manner as we head into the new decade.”
Vadim Toader, Chief Executive and co-founder of Proportunity, said:
“While there may have been concerns that Leave-voting areas in England and Wales would be hardest hit by a drop in EU trade post-Brexit, their property markets have been outperforming Remain areas since the referendum result was announced.
“Obviously this isn’t purely down to Brexit, with local factors at play and Leave-majority districts typically being on the more affordable side to begin with.
“London, which is over represented in the ten worst performing areas, has its own specific issues. The top end of the market has been hit hard by stamp duty reforms while first-time buyers in the capital are struggling to get on the housing ladder in the capital thanks to the eye-wateringly high deposits required, with the high cost of living in London generally eating into their ability to save enough cash for a down payment.”
What will this decline in prices mean for the property market?