UK Housing Prices could Suffer Setbacks with Exit Vote
The Brexit vote which is taking place in mere days is creating multiple behind-the-scenes opinions about what will be the fate of the UK housing market. Estimates vary widely, especially in regard to the future of house prices. Conservative to the other end of the spectrum is being broadcast with Zoopla making claims that much of the gains in house prices from the last five years would be lost. The company believes it is highly possible the market will return to prices not seen in five years if the UK votes to leave the EU.
The housing market website believes the cause of falling house prices would relate to higher interest rates, a reduction in foreign investment, higher levels of unemployment, and overall uncertainty about the future of the market in general.
Zoopla also believes prices in central London will be affected greatly. Prices could fall from the current average of £671,989 to the £550,000 range.
A Zoopla spokesperson commented on the possible impact of the June 23rd vote, saying: “While the economic impact of the referendum is hard to predict, it is clear that uncertainty is not good for markets.
“The prolonged uncertainty following a Leave vote would likely be negative for the property market, with… the average homeowner between £29,800 and £53,600 worse off, and with property values returning to levels last seen following the credit crunch.”
Remortgage activity is expected to continue to be at a strong level due to heavy competition within the lending community. Interest rates are currently sitting at low levels, but could rise soon after the vote, according to some close to the housing market.