Post-BREXIT Buyers Gain the Upper Hand

Once upon a time the nation enjoyed a relationship with Europe as a member of the European Union. Like most marriages it had its ups and downs but on the whole the United Kingdom has benefited from the additional trade, skilled labour and freedom created by encouraging free movement of services and labour across former borders.

Then came along Mr Cameron, the Prime Minister with the idea that the country should have the opportunity to say whether it wanted to remain as a member of the European Union, or leave.

At the time of calling the referendum the Guildford property market seemed healthy with local residents enjoying the benefit of seeing their homes increasing in value. Not only was it possible to determine what price their property was worth but one could be fairly confident that having withstood the 2007-8 financial crash, property prices were likely to rise as the property market faced increasing demand but limited supply of property stock.

The question now is where has the decision to consider leaving Europe left the local property market?

Speak to any estate agent in town and they will state categorically that BREXIT has caused uncertainty so people are not selling. The fact that builders are currently busy extending homes across the town might support this statement as people have decided to stay rather than move.

Estate agents cannot blame the market. If it is not BREXIT there will no doubt be another cause to blame. People still need to move. It seems that around 80% of people will move locally so this would suggest the local housing market will always remain buoyant. Perhaps there are too many agents chasing business in the market now that online agents operate alongside the traditional bricks and mortar agents in the current sluggish market.

The referendum took place 23 June, 2016 so we have had 3 years to reflect on what the decision to leave the EU has done to the Guildford property market and your property value. For those who need a reminder the voting in Guildford was exit 43.8% and remain 56.2%.

Data from the Land Registry, suggests that the national average house price has increased from £212,887 to £228,903 which is an increase of 7.5%. The comparable figures for Guildford confirm an increase of 6.4%, from £420,033 to £447,211 suggesting that prices have shown a slightly smaller than national increase. The increase in value for detached properties, compared to other property types, in Guildford has been the highest in the 3 years since BREXIT, at 9%.

The significant factor seems to be, not the price at which properties are selling, but the reduction in the number of transactions taking place. There were 1919 sales, in 2016, but this figure reduced to 1760 in 2018. This 9% fall does seem to support the local estate agents' view that the market has slowed.

While this fall in transactions might seem significant the continuing increase in house prices though relatively low, suggests that Guildford does not have cause for worry. Local property owners, it seems, will always be certain to experience an affluent housing market.

However house buyers may just have the upper hand when negotiating a house purchase, as sellers are currently experience lower viewings and offers while the market remains uncertain, so may be more motivated to accept lower offers. With low interest rates and a smaller market for lenders to compete in, buyers will have access to a more competitive funding market which in turn might help to stimulate the market.

If you should like to have a chat about any matters discussed in this article or about the Guildford property market in general then please do contact me.