Will Brexit affect house prices in Yorkshire?
The Chinese word for crisis is made up of two symbols, fear and opportunity. I believe that this meaning can be helpful to consider in light of the British people's decision to leave for Brexit.
For home buyers and sellers there have two key areas which I feel are really appropriate for you to consider:
Unlikely house prices will be affected
The value of property has been underpinned by two key factors, low mortgage rates and not enough houses being built. I see no reason for either of these things to change. The Bank of England will also be seeking to ensure banks have plenty of liquidity to allow them to keep lending at these historically low interest rates.
As far as I'm aware there wasn't a sudden increase in supply of new houses overnight and in fact a lot of builder's share prices have been under real pressure. This may lead to less new builds being completed which of course could lead to more demand for second hand property.
That being said we think that is unlikely that house prices will increase and therefore would be sellers should seriously think about taking advantage of the current environment of low borrowing rates for buyers.
Interest rates & impact on Yorkshire market
The future for interest rates is certainly unclear, a 5 year fixed rate mortgage can currently be obtained for around 2.5%. These incredibly low rates with years of certainty is definitely something that I would be recommending for potential buyers. Even if houses prices reduced slightly in the second six months of 2016 I think that for a buyer the ability to secure a 2.5% fixed rate now rather than gambling on higher rates in a few months' time is a decision I would make.
Having weighed up all of these outcomes I believe that the immediate impact on the Yorkshire market will be limited. Money will be cheaper and the perception that house prices may be peaking amongst sellers, will cause a nice increase in supply of houses with plenty of demand ready to take advantage of it.
Happy house hunting and I will look forward to updating you on how the first few weeks of the post-referendum world have developed in my next update.
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