1. The decision to leave the EU will most likely be felt in the central London housing market. House price growth is currently weak and we expect a modest price fall from current prices.
2. Due to the uncertainty of the impact on interest rates, inflation, house prices & buyer confidence there is likely to be a lack of investment and activity in the residential market, therefore buyer demand will fall resulting in a drop in property prices.
3. Foreign investors may be reluctant to invest in London property due to the uncertainty regarding the economic and political future of the UK, meaning once again that demand is likely to decrease and prices will drop.
4. Demand within the rental market will fall due to a reduced influx of EU citizens, meaning investors may choose to sell their properties or even lower rents.
Potential bad news for first time buyers
1. There may be more foreign investment as overseas buyers will see greater value in the London market due to the significant fall in the pound.
2. Plans to build more homes may have to be put on hold until the impact on interest rates, inflation, house prices & buyer confidence is known.
3. House builders will see their share prices slump, which may result in a reduction in the amount of homes being built.
Overall we believe any fall in prices will be limited. Due to the current uncertainty regarding prices, demand will reduce, however once there is more clarity regarding prices we believe property prices will settle down and property investment will be an attractive option once again.
All of the views above are assumptions based on our personal opinions, research and economic principles, there is no guarantee that any of the points mentioned above will take place.
For further information on getting on the property ladder you can download our first time buyer property guide here.