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Predictions: Will article 50 affect the UK property market?

28th April 2017 Print

Wouldn’t it be glorious if we could look into the future and see what Article 50 truly holds for us? It would certainly help the property market. With an unknown future on the horizon (although, when do we ever really know what the future holds?) investors are tightening their purse strings, buyers are waiting for more security and the government appears to be in upheaval. 

However, it’s not all bad according to our property experts, and the triggering of Article 50 may end up being in the property market’s favour. 

According to the looking glass of James Evans, CEO at Douglas & Gordon, the triggering of Article 50 could make the property market more stable. 

He says, “As every new landmark is ticked off on the Brexit timeline, the property market gets another boost of stability, encouraging people to get on with their lives.” So, will the acceptance that Britain really is leaving the European Union kick off some big sales? James seems to think so. “With confidence returning, sellers are already demanding higher prices,” he says.

On the other end of the spectrum, Lucian Cook, director of residential research at Savills told the Financial Times that the caution is going to stay put for some time yet. “He predicts that buyers will be most cautious in London, given that buying a home in the capital is a bigger financial commitment that elsewhere in the country,” reports the FT. “Mr Cook predicts that values there will ‘pretty much flatline for a couple of years.’” So, with the London market already flatlining, what Cook means is that there is not going to be much change over the next couple of years. 

However, as the Financial Times looks into the broader picture they make an interesting point. Will the inflation to society and the decline in sterling have an impact on the property market? Neal Hudson, director at Residential Analysts, explains that as consumer sentiment starts to weaken due to inflation, people may decide to renovate or extend rather than risk a transaction for a bigger home. 

All of this withstanding, the fact that there is a property shortage remains the same and demand is sure to outweigh uncertainty. Russell Quirk, founder of eMoov.co.uk explained to Homes and Property that even if the caution stakes are high in London, the demand is so great for housing in general that the gaps will begin to fill further afield, pushing house prices up outside of London. 

If you are feeling uncertain about the future of the property market and where you should be putting your cash, it may be best to speak directly with someone with plentiful experience. Daniel Goldberg, First Urban director, is approachable and has a wealth of experience in the property investment sector. Daniel has been involved in the financial side of property transactions over the years, so will have an idea of what you should be looking out for in the coming months.