Impact of Brexit on UK Real Estate Market
The people of the United Kingdom took the decision to exit the European Union in June this year after a referendum. This vote of the British people to exit the EU became popularly known as Brexit. Brexit came as a shock to the other members of the EU and also to the world. It became a hot topic within minutes and trended on social media for weeks. Media covered the news from all across the globe. This decision by the UK people has already started to have a significant impact on the property market and economy of the country.
The UK real estate market had been flourishing for the past many years. The demand for real estate properties in London had especially been quite high. However, after the stock market crashed a little in the aftermath of the Brexit, the real estate sector took a hit too.
Commercial real estate values have fallen by about 3-5% while residential property values have also gone down significantly in the UK ever since . This has come as a shock for many who were planning to re-locate or move to a bigger home by selling their current house so that they can finance a larger one.
At the same time, this has provided a good opportunity for those people who are looking to buy new properties. The following are some of the recent trends caused by Brexit in the UK property market.
Drop in Prices of Commercial & Residential properties
|A significant drop ranging from 3-5% has been reported by real estate experts. Predictions of further fall in prices have also been made by many people who are regularly engaged with the industry. This has meant that the property prices which were increasing for a number of years have gone down for the first time. The primary reason for this fall in prices is the uncertainty created by the Brexit vote.|
Softening of Demand for Houses
|The Brexit vote has had a negative impact on house demand in the UK property market. There have been very few enquiries made by new buyers in the couple of months that have passed since the Brexit decision was made. The reason for this primarily is that there are no properties on the market at the moment. Sellers have taken their homes off the market for now because the construction activity rate is too low.|
Increase in Foriegn Investor Interest
|A positive impact of the Brexit on the UK property market has been the increase in the interest shown by foreign investors. Now that the property prices are down and the Pound is at an all time low, the foreign investors are considering this the best opportunity to buy UK properties. However, nothing has materialized till now as the sellers remain on guard and reluctant to let go off their properties just yet.|
Why is Brexit Forcing People to Sell up Fast
While Brexit has caused the property market to slow down, it has given an incentive to new buyers. People looking for a new home are thinking that they might get a bigger and better residence on the cheap as house prices drop. The biggest hurdle that they are facing though is that selling their home first is becoming a problem. With the demand for homes softening, it is difficult for them to locate buyers. This is causing the people to think about ways through which they can sell their homes quickly. Visit Harwood Quick Sell, if you want to sell your home fast at a good price. The following are some other reasons why Brexit might be forcing people to sell their properties fast.
• Market Uncertainty
Market uncertainty might be one of the reasons why some people might be thinking about selling their homes quickly. To avoid the risk of losing out on properties that are currently priced quite low on the market, some homeowners might be tempted to sell their own homes quickly so that they can get their hands on those low priced homes. Once the market uncertainty recedes, there is a chance that those low priced homes might become expensive again.
• Fear of Prices Going Down Further
Another reason why Brexit might be causing people to consider selling their homes fast could be the fear that the prices of their properties might drop even further in the coming days. It is a distinct possibility and if it happens then they might not be able to recoup the money that they had spent on buying it in the first place.