When most people think about Brexit, they think about trade and travel. However, the potential ramifications do not solely lie in imports and exports but can also be found in the very homes we seek to buy. While the thought of homegrown independence was romanticised, the harsh reality is starting to buckle the UK; namely in the housing market.
Consequently, here’s a closer look as to how Brexit is impacting the UK property market.
London Price Drop
Most notably affected is the usually incredibly expensive London. Of course, a price drop here doesn’t mean good things if it’s not done in a measured, planned fashion that the city can’t carefully architect. It yields disastrous consequences in the real estate business; namely that they’re unable to make their money by flogging homes cheaply. The economy is not in a position to let London companies get generous, and on this affect, any industry could collapse in due time.
Reportedly, London house prices have fallen by as much as 15%, grinding the property market there to a screeching halt. The north however has grown by comparison, but still, the capital city is the epicentre of trade and commerce in the UK. Prices need to be somewhat steep to control overcrowding in a place rife with industry, so with the flood gates open, the London property market is now embroiled in chaos.
It’s no secret that many businesses are abandoning the UK in the wake of Brexit and heading back to the EU. Of course, Brexiteers are quite happy to wave these disloyal braggards adieu, but one thing they’re undoubtedly overlooking is the affect this has on the housing market. Immigrants used space, and now that space is empty.
Yes, business people have homes. Whether they’re employees or lavish executives, they all required residences to work in the UK. With them gone or going, said homes now or eventually lie empty and unused, whether it’s high end or low-end property. This affect will be major if EU immigrants leave in mass, and once again add to the dumpster fire of impractical price reductions in housing.
Branded as the ‘rent generation’, millennials no longer see buying homes as a reasonable goal to achieve anytime soon. It’s been reported by The Financial Times and this news item that they favour investment into shares over home ownership. It doesn’t stop there either, bitcoin trading is more than just a fad; millennials are trying to grow their money through cryptocurrency instead of wasting their time scouting opportunities in property that are no longer viable for them.
Of course, even millennials, like the rest of us need somewhere to live and ideally it’s in a home they own so while it’s not a great time for them to get onto the property ladder and the feeble property market is now a shadow of its former self, it’s a case of “never say never”.
Growing a deposit for a future property purchase is a solid goal to have and should be encouraged; even if the impact of Brexit on the UK property market has young people turn their heads back to property right now.