What affect would the Scottish Independence have on the housing market?
Scottish independence is one of the burning issues of our times. The independence debate gives rise to a million ‘what if’ questions due to the inherent bureaucratic links between the two countries. Unions have split amicably before, but it’s not always going to be that easy.
What would happen to the pound? What would happen to our UK bureaucratic agencies - how could they begin to be remodelled and divided, and to what cost? Who gets the North Sea Oil?
For some, one question is particularly pressing – What would happen to house prices? Jonathan Green of property buying firm Swift Capital ltd has said “we’re currently experiencing a huge rise in enquiries regarding the fast sale of property and what may happen in the event of independence. The potential for a price bubble south of the border is very real, however this is purely conjectural at this moment in time.”
A lack of business confidence and money being withdrawn from the Scottish economy would certainly see house prices undermined. So will there be an influx of people migrating south of the border before the vote? Especially those who had planned on moving and want to beat a possible price drop.
Remember how some famous French citizens fled to foreign climes when they feared the top rate of tax under the new left wing government. Perhaps places like Berwick could grow to become a haven for Scots crossing the border, and indeed house prices in the English border country could see an increase in value.
The decision with regards tax is probably a separate issue and depends on your political leanings. If you’re settled in your home and feel independence is the right thing for Scotland, then house prices may not be too much of a concern. Those on the ‘housing ladder’ may feel like the house prices/independence issue is a big deal.
Much of this article is speculation and the results of independence are up for debate, but markets respond to speculation and falling house prices could become apparent in coming months.
UK citizens have for a long time, rightly or wrongly, been fixated with house prices as the measure of a good economy. Many a citizen’s outlook on the economy is defined purely by the property market. This has led the government to go as far as artificial inflation in the case of schemes like Help to Buy.
There are a lot of questions still to be answered regarding Scottish independence and the answers don’t seem to be forthcoming from the political classes on either side.