How Brexit Will Affect House Prices in 2019

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Three years ago, the UK public voted to exit the European Union. Since this was an outcome that only a few people expected, it had a dramatic outcome with David Cameron, the prime minister, resigning with immediate effect. The vote caused a stir in the financial markets.

A few weeks after the results, the pound sterling was still weak, and the economy, in general, was on the verge of going from bad to worse. Many business leaders who were benefiting from the stable UK economy started to fear that they would soon encounter a critical financial crush. These were the very first indicators of the negative impact that Brexit had on the economy.

Now it’s been two years since Brexit, and the financial crisis that most sceptics used to talk about is yet to happen. Though there has been a long waited expectation of economic breakdown, the UK still seems to be a good place that investors can confidently park their money and yield impressive returns.

This should act as an eye-opener to aspiring business persons who are scared to invest in the UK market. In fact, despite Brexit, the UK economy has managed to rise in terms of DGP, which grew by 1.8% in 2017. This is considerably higher than what as expected in late 2016.

In addition, it has been reported that the property market in the UK has continued to bloom. The secret to this is that the weak pound is making the UK a better place to invest, thereby attracting many foreign investors who know how to maneuver through the small odds. The foreign investors coming with some currencies get 20-30% on the pre-Brexit exchange rates, thereby giving them 20-30% more buying power. It is a matter of playing smart and knowing where to put your money as a foreign investor.

Though it was forecasted a few months to Brexit that UK’s property market is going to collapse, we have seen that at least €84 billion has been invested in the same market. This is a clear indication that the property market is here to stay and that it is still going strong. Also, in 2018, it was indicated that the price of houses in the UK had increased by at least 3.9% in the previous years and by up to 6.6% since the UK public decided to vote Brexit.

Supply and demand is the one primary reason for the continued growth and stability of the property market and hence the level of inward investment. However, it is worth mentioning that while the prices of housing in the UK is going up, it only impresses the investors but not individuals looking to acquire new homes.

For many years, the UK has reported a significant shortage of houses, and due to Brexit, more investors were scared. At the moment, the problem has even become more prevalent in various locations within the country. Therefore, despite the existence of Brexit, the prices of houses are expected to go up.

In the current time, there is high life expectancy with many elder people choosing to stay in their homes instead of seeking care homes. At the same time, there is a young generation that is looking to leave their families and get new homes, either as first-time buyers or renters. These are the main sources of pressure on the property market in the UK, which, in turn, brings about the rise in the prices of homes and other landed properties.

Final Thought

Whether it is safe to buy a house in the UK in 2019 depends on your short-term or long-term plans. For instance, since the property market is doing well, you can choose to invest and sell your house at a higher price in the future. If you are looking to get a new home, then this might not be the right time since Brexit might make the prices to go higher with few investors coming in.

Since there is a housing shortage, the prices are expected to rise until more investors start to come in. Your safety of buying a new home or land in 2019 depends on what you intend to do with it. Before investing, you can use the propertypriceadvice.co.uk/budget-calculator  to determine the prices of properties at that particular time.

By Uday Tank

© 2019 Copyright Uday Tank - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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