100 days after Brexit:how the UK's vote to leave the EU has impacted the property market

The Evening Standard

Today marks 100 days since the UK voted to leave the European Union.

The shock of the referendum result seemed to hit London property the hardest, with initial uncertainty leading to reports of deals falling through.

Three months on and, so far, the housing market fallout from Brexit has not been as dramatic as first predicted.

Today's figures from Nationwide's house price index reveal that growth has slowed to 5.3 per cent across the UK over the past 12 months, as buyers exercise more caution.

1. Property sales are slowing
"We have seen mortgage completions and approvals falling, suggesting a slowing market, but it is very early days and data is limited," says Lucian Cook, Savills UK head of residential research.

"Perhaps the best signal we have so far is from the Royal Institution of Chartered Surveyors survey.  This shows new buyer enquiries and new instructions are falling at the same rate, suggesting that there will not be a downward pressure on prices."

2. Price rises are slowing, but there's still growth across the UK
The latest figures from Rightmove reveal average asking prices have only marginally risen to £306,499, a growth of 0.7 per cent on the previous month, with seven out of 10 regions in England and Wales seeing house prices rise or at least remaining steady.

Slowing price growth isn't solely Brexit-related, however. After several years of double-digit rises, affordability has weakened and cooling price growth is widely seen to be a natural correction of the market.

3 . Low interest rates are helping to boost sales
UK interest rates are now at a record low of 0.25, following the Bank of England's decision to cut the base rate by a quarter of a percentage point for the first time in seven years, last month. 

"A cut in interest rates is the antidote for the post-Brexit worry and will, as a consequence, ensure that the UK economy continues to be underpinned by buoyant property prices,” says eMoov.co.ukfounder Russell Quirk.

4. Prime central London was hardest hit, but is recovering
"The market is not as fluid as it was at its peak in 2014 so buyers can now afford time to do their homework before committing to an offer," says Jonathan Hudson, London executive of the National Association of Estate Agents.

"It's been 100 days since Brexit, but more importantly it has been six months since the increased levy on stamp duty which, if anything, has been the real catalyst for the market to slowdown."

“Those who were going to pull out of deals or withdraw their properties from the market did so quickly," agrees Marcus Dixon - head of research at LonRes.

"Those who are buying now are buoyed by the negativity within the market as they are looking to negotiate on price.”

5. Fall in pound's value is helping to boost the prime market
"The London market does seem to be benefiting from the fall in Sterling. Even with uncertainty about the future performance of the UK economy, the fall in Sterling gives an effective 10 per cent discount to those buying in US Dollars - a very good cushion against risk," says Fionnuala Earley, residential research director of Hamptons.

6. Article 50 continues to cause some uncertainty
"Going forward we believe the market will continue the upward trend enjoyed for quite some time now. It would seem that the triggering of Article 50 - or lack of at present - may cause more indecision in the market than the implementation itself,” says Quirk. 

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