Thursday, August 11, 2022

Brexit continues to drag down the UK property market

Brexit is continuing to drag on the property market, with estate agents expecting further fall in home sales

Brexit is continuing to drag on the property market, with estate agents reporting little increase in demand from buyers and sales expectations weakening.

The Royal Institution of Charted Surveyors said Brexit-related uncertainty is having a significant effect on buyers’ and sellers’ decisions to delay property transactions.

It said expectations for house sales deteriorated in August, while the last month of summer also saw demand from new buyers flatline after several months of growth.

Rics’ chief economist Simon Rubinsohn said that it is hard to get away from the shadow being cast over the housing market by the seemingly never-ending Brexit saga.

Rics also said the number of new properties coming on the market in August was more or less flat once again.

Looking forward, Rics said a net balance of 23 per cent of surveyors expected house sales to dip rather than increase in the next three months. However, a net 12 per cent did expect property prices to increase rather than fall over the next year.

The UK’s largest mortgage lender Halifax’s latest house price index revealed house prices increased just 0.3 per cent between July and August this year, and just 1.8 per cent on August last year.

The bank said prices were being propped up due to a shortage of properties on the market, with homeowners staying put in the face of political uncertainty.

Halifax’s Russell Galley said there was evidence of both buyers and sellers exercising some caution, with ongoing uncertainty continuing to weigh on consumer sentiment.

He added that the single biggest driver of both prices and activity over the longer-term remains the dearth of available properties to meet demand from buyers.

Rival lender Nationwide’s own latest index found prices crept up just 0.6 per cent last month, with the building society’s chief economist Robert Gardner remarking that surveyors report that new buyer inquiries have increased a little, though key consumer confidence indicators remain subdued.

He said that data on the number of property transactions points to a slowdown in activity, though the number of mortgages approved for house purchase has remained broadly stable.


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