Should I Wait Until after Brexit to Buy a House?
30 November 2018
There are many conflicting opinions on whether UK house prices will rise or fall in the wake of Brexit. This can make it difficult for prospective buyers to decide whether to buy a new home now or wait until after we have left the EU.
Unfortunately no one has a crystal ball, so while there are many theories out there, they are ultimately just that – theories. We've put together some concise guidance on what the experts are saying, to help you to make an informed decision on whether to buy before or after Brexit.
What Do the Experts Say?
According to the Governor of the Bank of England, it's likely to come down to what the final Brexit deal looks like when we exit the EU. He has warned that the economy could suffer significantly in the wake of a no-deal Brexit, with house prices falling by up to 30%! While this is a worst case scenario it's a figure that has shaken many homeowners, harking back to the housing market crash that we saw in the midst of the financial crisis in 2008.
It's believed by some that Brexit will have a more acute impact on house prices in the capital, with a survey of property analysts in London predicting a short term dip of 29% after Brexit. So for those buying property outside of the capital the effects of Brexit might not be felt quite so sharply.
On the other hand, some experts predict that the housing market will continue to grow but that this growth will slow, depending what the final Brexit deal looks like.
What Does the Public Think?
Research carried out by Emoov shed some light on what the public is expecting to happen. 30% of respondents to their survey expect house prices to continue increasing despite the current uncertainty, with 28% expecting prices to plateau and 4% expecting them to fall.
What Has Happened So Far?
This all being said, previous expert predictions estimated that the market would slow to a point where house prices would have increased by no more that 1% between 2017-18, but in fact they have increased by over 3%.
The volume of transactions also increased by 1.7%, indicating that the housing market is in better shape than some expected during such turbulent times.
So What Should You Do?
While different experts have different theories on the effect Brexit could have on the UK's housing market, what they all appear to agree on is that there is a lot of uncertainty. This means that no one really knows one way or the other exactly what's going to happen to UK house prices in the wake of Brexit.
Ultimately, you need to trust your judgement. If you've found your dream house and it's the right price, then think carefully about whether you'll regret letting it slip away. If you are planning on staying there for a long time then any impact that Brexit has on house prices could pale into insignificance against the backdrop of a happy family home that you'll live in for decades to come.
On the other hand, if you're not in any hurry and you think it could benefit you to wait, then it could be worthwhile doing so. This also might be the case if you're looking for something to turn around quickly and make a profit on. But remember that you could find yourself paying more in the long run if Brexit doesn't have the negative impact on the UK economy that some experts are predicting.