The London Property Market post Brexit
Since Theresa Mary triggered Article 50 on March 29th it’s fair to say the country has experience a fair amount of turmoil. However, contrary to what some believed would happen, the London property market hasn’t come to a crashing halt.
People’s cautious approach to the market is understandable after the effect of the UK referendum. The plummeting of some stock market shares, combined with rising Stamp Duty charges and reduction in landlord tax breaks all contributed to a wavering market.
However, not everything in 2016 was doom and gloom and, according to official London Registry Data, the London market ended the year with 7.5% property price growth YOY. The element of surprise experienced in June 2016 was also absent this March, a fact that will surely help curtail a similarly hectic market.
Last year’s weakening of the pound boosted the more central parts of London, with increased Chinese and Middle Eastern interest in the UK property market contributing to the flourishing of international investment. This powerful demographic is unlikely to be deterred by the UK’s exit from the European Union, and by all means should be more than willing to continue to invest.
According to the latest Halifax HPI, house prices in the month leading up to Article 50 were 3.8% higher than in February 2016. While this is the lowest level seen for four years, demand is still outstripping supply. Moreover, as interest rates are set to remain at the same level for at least another two years, and with historically low mortgages rates in place, we can expect the London market to carry on, albeit at a slower pace than we’re used to.
Depending on what publication you read, you’ll have been informed that the value of your property will either be plummeting to disastrous depths or soaring to great heights. As we have yet to find out how the UK’s exit will be negotiated, the only thing certain at this stage is the necessity of keeping a cool head.