Brexit uncertainty leads house hunters to put plans on hold
Over 1 million UK adults have halted plans to buy a new property following the decision to leave the European Union.
According to research from both HomeOwners Alliance and BLP Insurance, 15% of UK adults have put plans to purchase a new home on hold. Although nearly one in six of these cited Brexit as the reason behind their decision, the outcome of the referendum in June 2016 was not the only factor for people putting their moving plans aside.
Whilst 26% put their decision down to growing house prices, 25% referenced the increasing cost of living, with an additional 25% stating that they had been put off by the difficulty of securing a mortgage or of re-mortgaging. The cost of stamp duty was a factor for almost one in ten, with 9% changing their plans because of the extra expense.
Those most likely to have put their move on hold were located in the North East (27%) and Northern Ireland (21%).
Commenting on the figures was Paula Higgins. The HomeOwners Alliance Chief Executive mentioned that in order to function efficiently, the housing market requires certainty.
“Our research demonstrates that both first-time buyers and those who already own a home are choosing to play it safe in these uncertain times. With the government preparing to trigger Article 50 this week, we can expect further uncertainty in the market until the UK’s future relationship with Europe is more clearly defined. People putting off plans to buy or sell chokes housing supply and generates pent up demand. The housing market needs certainty in order to be able to function most efficiently.”
“The government could help to ameliorate the situation, by looking again at stamp duty. It remains stubbornly high and acts as a drag on the market. Reducing the burden for genuine owner-occupiers could really help to keep the market moving in these uncertain times.”
Also commenting on the research was Chief Executive Officer of BLP Insurance, Kim Vernau. She stated: “We’re at a critical juncture for the UK property industry as we await further clarity around the terms of the UK’s exit from EU. Purchasing a new home is one of the biggest decisions that an individual is ever likely to undertake, and this is only compounded by the fact that average house prices are continuing on their upward trajectory.
“It’s therefore not surprising that many people are putting their housing ambitions on hold amidst the prevailing uncertainty.”