With still no agreement at Westminster over Brexit, political uncertainty is affecting the country on an increasing scale. Not knowing what type of Brexit will eventually be thrust open us, nor how everything from the price and availability of food to our ability to travel will be affected once it finally happens, is creating indecision across multiple areas.
The UK’s oft-discussed housing market is among those areas that is definitely suffering the effects of that uncertainty. But, how and by how much are two details that aren’t too clear. A bit like Brexit…
Brexit and home-buyer plans
A recent survey shows that just 12% of those planning to buy a home are delaying their decision due to Brexit uncertainty. Some two-thirds of those surveyed by Legal & General Mortgage Club, however, said the political indecision wasn’t affecting their plans.
Meanwhile, some 5% of survey respondents said the Brexit debate had encouraged them to speed up their home-buying plans, with hopes of having everything completed by the time the UK formally exits the EU.
But, while that report suggests that overall, home-buyers will continue on as planned regardless of the political backdrop, of those 12% who are delaying a purchase until the post-Brexit period, home-buyers and sellers in London and the south-east were the most likely to adopt a wait-and-see attitude.
The survey identifies 34% of homeowners in London and the south-east had reconsidered their plans due to Brexit. That compares with just 24% of homeowners in the East of England.
On balance, though, Brexit isn’t proving to be a major spoke in the wheel of the housing market – just yet.
“We’ve heard plenty of predictions from commentators about the housing market, but these findings clearly show that homeowners are largely undeterred by the impact of current political uncertainty. The demand for property is still clearly there,” said Kevin Roberts, Director, Legal & General Mortgage Club. “That said, there will be buyers who are unsure of what steps to take or what support they could get to make their plans a reality.”
First-time buyers less sure amid prolonged Brexit debate
While the general tone across all home-buyers is broadly that Brexit isn’t having a huge effect on their home-buying and selling plans, among first-timers, the uncertainty appears to be playing a bigger part in their thoughts.
A survey from financial services provider, One Family, shows that more than half of first-time buyers it surveyed are delaying their home buying plans due to Brexit uncertainty.
The survey shows 55% of respondents, which accounts for some 136,000 of potential home-buyers across the UK, are waiting for a clearer idea of what Brexit will entail, before paying down their hard-saved deposit and signing up for a mortgage.
The reason for their delay? First time buyers said they expect to get more for their money, post-Brexit. In addition, 75% of those first-timers who are waiting until after Brexit happens said that there is just too much uncertainty with regards to the UK’s economic future, right now.
However, 22% of those surveyed said they plan to buy a property before Brexit. Reasons for that include they’ve found their perfect purchase, they’ve already waited long enough and 15% said they don’t think Brexit will affect property prices.
It’s clear then, that while the property market won’t come to a standstill amid the ongoing Brexit brawl, uncertainty is staying the hand of first-timers and those in and around the English capital. Perhaps because they feel they have more to lose if a disorderly period ensues once the UK exits the EU?
Whatever the reason, the longer the political disagreements continue and uncertainty reins, its likely more home-buyers will become more cautious, which definitely is not what the UK economy needs, right now.