How Will Brexit Affect The UK Property Market?

The latest reports by RICS claim Brexit is challenging growth in the UK Property Market. Despite the uncertainty created by Brexit, London prime properties have been attracting buyers from overseas, mostly from the Middle East and Asia. The expectations of a drop in price amidst no deal seem to be a little too much. The UK Property Market has been resilient amidst geopolitical tensions, interest rate slash and political uncertainties and a general slowdown in a global economy that has been affecting all the markets and Property for sale Manchester. The decline in sales can be linked to the 2008 crash, where the prices picked up in the initial years and have flattened in last years’.

Overseas buying

The market witnessed a boost in transactions post-Brexit deadline as many new overseas funds were seeking opportunities in the UK before Exit like Malaysia’s state-run Employees Provident Fund that invested $150m in British retailer Sports Direct International’s logistics facility in May.

Many international buyers anticipate the current Brexit slowdown in properties is a chance to get a significant buying opportunity before the market correction, which will lead to a historic bounce back and apartments for sale manchester city centre.

In 2018, the Middle East Ultra Bet Worth buyers invested over $3.3 billion in London properties (Knight Frank report) and some property dealers claim post-referendum the inquiries have increased.

Some of the prime London properties are now 40 percent cheaper as compared to the 2014 prices. The overseas buyers are attracted to the lowering pound rates and low-interest rates. They are also targeting the Tier 2 cities and Manchester Property Markets where the capital value is low and yields are higher as compared to London and South East and Flats for sale Manchester city centre in the UK.

Stamp duty

The introduction of stamp duty created a set of new expenses for homebuyers who are not willing to invest in stamp duties on sale and then again, on buying a new home. The increase in stamp duties also affected foreign buyers. Some sellers are waiting for the new Boris Johnson government to slash stamp duty which will allow more sellers to put their homes on sale and commercial property for sale manchester city centre.

Affordability

Affordability is one of the key issues in the city like London where the average price of houses is £619,000 — almost 3times the prices of homes in the East Midlands.

The price of homes in London is 13 times the average of England and Wales and the young earners are seeking opportunities in alternative regions like the property market in Manchester and Leeds. The young generation is facing unaffordability issue due to high prices in the key employment cities London and Manchester rental market and hamiltons estates.

Growing rents

It is assumed that Brexit, or no-Brexit the market will remain resilient and continue to grow at a slow pace this year, as the rents in the capital city are growing and the number of renters continues to amplify. The total investment in the UK multifamily sector grew more than 150% in 2018 to $7.6 billion as per JLL reports, and investment volume doubled to 2 billion euros as compared to the previous year, which shows the market continues to remain strong.