Our latest research has looked at market confidence amongst UK homeowners and if they expected the market to act as it has since the EU Referendum vote, and what they think will happen once we officially leave the EU. We also looked at the state of the UK property market across both the Remain and Leave camps to see where house prices are performing best.
We asked UK homeowners, since the Brexit vote, did you think house prices would increase by this much when the result was announced?
Believed that property prices would increase after Brexit
Unsure if property prices would be impacted after Brexit
Believed that property prices would fall after Brexit
Since the Brexit vote, house prices have increased across the UK by 9.3%, but market uncertainty surrounding our exit has been blamed for a slow in the rate of growth.
While uncertainty was prevalent amongst 24% having answered that they didn’t know, the majority (28%) had expected house prices to climb as much as they have. 21% thought they would have grown by less with just 15% thinking they would have fallen and 12% believing they should have grown by more.
We then asked, given the current status of our exit from the EU what do you think it will do to the market?
The majority (30%), again, believe house prices will continue to increase, with 28% thinking prices may flatline. 26% of UK homeowners aren’t sure what will happen, while 12% think they will see a slight decrease and just 4% think they will tumble.
But does this confidence translate to house prices and how do the Leave and Remain regions of the UK compare where price growth is concerned?
No overall UK region has seen a fall in prices and just 16 local districts have seen prices fall since the vote, down 3.3% on average with only three home to a majority Leave vote – Middlesbrough (-0.08%), Darlington (-1.19%) and Spelthorne (-1.23%).
Average growth of Leave districts since June 2016
Average growth of Remain districts since June 2016
When looking at the total split across the whole of the UK, the 270 districts that voted Leave have seen house prices increase by an average of 9.46% since June 2016. On the other hand, prices across districts to vote Remain have seen an average increase of just 5.05%.
In London, boroughs to have voted Remain have seen an increase of just 1.8% since the vote, with house prices in boroughs with a majority Leave vote up 6.2%. The East of England is home to the biggest gap with Leave districts up 9.1% to just 4.2% for Remain, with the West Midlands also home to one of the biggest gaps with Leave districts up 11.8% to just 7.3% in Remain areas.
While Brexit uncertainty may have slowed the rate of price growth it’s clear that it isn’t causing the Armageddon-like scenario that many have prophesised, based both on historic data and the current majority sentiment of UK homeowners.
Of course, there is a degree of uncertainty in the market, but this has most certainly been exaggerated and used as a tool to talk the market down for those hoping to swing a second vote. Ironically it’s the areas with a Remain majority that have fared worse where house price growth is concerned.
This could be coincidental, but it may also demonstrate a more business as usual attitude within the Leave majority markets, with those less phased about the implications of what they voted for stimulating both buyer demand and stock levels, while Remain areas are seeing both buyers and sellers still sat on the fence.
The UK market has overcome far worse then it’s current predicament and will no doubt continue exceed expectations once our departure has been confirmed via Article 50.Russell Quirk