As Brexit negotiations drag on, the state of the British property market feels precarious. Brexit’s uncertainty has diminished confidence in the property market, and many are concerned if property prices are heading for 1990s-style meltdown.
Houseowners who are looking to sell are understandably concerned about their prospects. Some want to accelerate the selling process, while others consider pulling their property back for the time being. But more than anything else, everyone wants accurate and trustworthy information.
Many of our Doorsteps estate agents have received questions about this matter. The goal of this article is to provide you with facts worth taking into consideration if you’re currently looking into buying or selling your property.
Looking Back at the Situation in 2018
2018 wasn’t a good year for houseowners looking to sell their property.
Asking prices in 2018 rose by only 0.7% in comparison to the 1% increase back in 2017. It’s clear that the situation became more difficult last year. 2018 saw the smallest increase in asking prices since 2010.
Well-known property hotspots in London and south-east England did especially badly. In the capital, asking prices plummeted by 1.1%. They fell by around 0.9% in the south-east.
There is another unfortunate 2018 trend you should take note of.
Every year, asking prices go down in the winter. This is mainly because of the Christmas rush. Sellers hope to entice buyers as well as to sell to those who want to start the year with a significant change.
However, the 2018 decrease was more substantial than usual. From October to December, asking prices dropped by an average of £10,000. Experts agree that the uncertainty around Brexit is the main culprit for this change.
This seems like grim news for anyone hoping to sell their house in 2019. But let’s look at how the situation is unfolding for now.
What We Know About the 2019 UK Property Market So Far
For the moment, it’s best to describe the situation as “frozen”.
If you’re currently hoping to sell your property
, you should know that buyers are extremely cautious. Many of them are waiting for the Brexit deal to be solidified finally. Unfortunately, some foreign buyers have been locked out of the market by Brexit. Renters have also become more reserved, which means that people who buy-to-let are having second thoughts.
But the situation isn’t entirely bleak.
High-value properties have seen some activity. Some well-to-do foreign buyers used the current political situation to their advantage and made impressive investments.
It’s also worth noting that the change hasn’t affected the entire country equally. At the moment, the Midlands and the north of England are doing better than London. Experts say that this trend is likely to continue.
Understandable, people have been interested in remortgaging. This year has seen more remortgaging plans than several previous years. For now, interest rates have been moderate.
A Few Predictions
So far this year there has been a noticeable lack of interest for homes in a low to average price bracket. This is especially true for former property hot-spots and southern England. But what does the future hold?
As the political situation is about to resolve, there’s a significant chance that the second quarter of the year will be more successful than the first. However, the future of the property market depends on how the country’s economy will react to upcoming changes.
Some possibilities, according to
experts who spoke to the BBC:
• Recovery from 2018: an overall rise in house prices, up to 4%
• The property market remains frozen: no change in prices
• A continued post-Brexit reluctance to buy property: house prices might drop by up to 5%
Right now, it’s impossible to say which of these predictions is the most realistic. But what’s the worst possible scenario?
The Bank of England released a forecast of the potential consequences of a “hard Brexit”. In the most extreme case, the market will crash and prices will go down by 35% over the next three years. However, this doesn’t seem likely at the moment.
A Final Word – Online Selling
What is the takeaway for potential sellers?
If you are hoping to make a good sale, you have a few options. Many sellers prefer the wait-and-see approach, hoping to get better prices after the political situation becomes stable again. Others prefer not to risk it.
One of the best solutions is to get an online house valuation
and find out what your property is worth at the moment. If the price seems satisfactory, try to sell it online. Economic instability notwithstanding, there are still many buyers hoping to find their perfect home.