Brexit – should I stay or should I sell / buy?
With Brexit looming on the horizon (or is it) we thought we’d share a bit of insight into the market and feelings in general re the UK and what may / may not happen to house prices post Brexit. In fact for Brexit, the most crucial moment for homeowners will not be the scheduled exit from the EU on March 29 2019, but the deals / no deals currently being thrashed out.
According to the Royal Institution of Chartered Surveyors’ monthly survey in Sept 18 the outlook for house sale prices in three and 12 months’ time was the lowest since June 2016, with Brexit the key concern among buyers.
We as Estate Agents have seen and talked to many people who are more cautious re house purchases / sales with the advent of Brexit and as such have decided to sit tight and “wait and see”. We have seen a small decline in house sales and an increase in supply compared to 2017. On the other hand there are other people who are more concerned that prices will drop dramatically and as such have decided sell before Brexit. So what to do?
With not as many houses being on the market at present, you have more visibility for your property, and with the uncertainty re prices post Brexit, if you definitely want to sell now you might find actually your property sells really quickly, and you at least know at the moment your house is going for a good value, maybe not quite as much in 2017, but this very much depends on the area / property, popular areas such as BS6, BS8, BS3 – these areas have seen very little decline in prices.
But house prices might not go down post Brexit, in fact all those people “waiting and seeing” might then decide they’ve waited long enough and start wanting to move / buy and demand will surge and prices will move accordingly.
For the first time in many years it is now a buyers’ market, they have the upper hand and can therefore negotiate more, if someone is looking to buy and live in a home then why wait, many people stay in a house for 10-12 years or more, so any current dip in prices will most certainly be readdressed when Brexit is way in the past and you’ve been living in your lovely home for all those years having bought at a good price in a non-bidding war and not losing out on property after property. Plus interest rates remain at a historic low and mortgage rates are very attractive. Many people are rushing to lock themselves into a 5 year deal as they feel rates will inevitably go up after being so low for so long.
What will Brexit mean long term?
Hardly anyone really can understand the full impacts of what Brexit will bring / won’t bring to the UK. But as Estate Agents we’ve worked through recessions and troughs in the market before and one thing is always constant, house prices in the UK always increase. We are a small country with people who are accustomed to buying houses and don’t have an ever-increasing supply of new houses.
Whatever will / will not happen post Brexit, it’s important to remember that a house is long term investment, and is a home, your home, it is good to remind yourself it’s not about how much it’ll be worth in 2020 / 2025 and so on, it’s your home and what do you want for yourself and/or your family NOW in 2019.
What will Brexit mean short term?
If Brexit does provoke another financial crisis or recession, and property values drop, it’s only a drop on paper, and property is as mentioned above, a long game. The property market normally corrects itself in a cyclical manner, other than Brexit there are no main elements that could cause the market to crash, we are economically stable with good employment and record low interest rates and first time buyer schemes are incentivising people to buy but tight planning laws mean we can’t build enough new property.
Should I sell and buy back my house in 2 years at a lower price post Brexit?
This is a question we’ve been asked several times in recent months, and our answer is always along the lines of, this is of course personal preference, and you are effectively banking on a very large drop in prices in a short space of time to make it worth your while given the fees and costs associated with selling / buying, plus the element of uncertainty / renting for 2 years and not being in the comfort of your own home. It comes down to how much you are willing to risk and what you are prepared to do without.
I have more questions…
Then please give us a call, we are happy to chat through all things property!
Thanks for reading
Bristol Property Centre