Brexit has undoubtedly had an effect on the property industry. Many agree that it has subdued it, with a fair amount of buyers erring on the side of caution.
However, land agent, Aston Mead believes that it has also led to a pent-up demand, which is likely to feed back into the market next year.
Richard Watkins, Aston Mead Land & Planning Director, said: “Any degree of political or economic uncertainty means that buyers tend to sit on their hands. People with important and costly decisions to make tend to pause and reflect, waiting for a time when the outcome is more predictable. The ongoing machinations of the Brexit process for the last two years are no exception – so little wonder that the property market has become increasingly subdued as time has gone on.
But it’s also true to say that this situation has led to an undeniable pent-up demand – especially in London and the South East – which is likely to make itself evident, once Britain leaves the European Union on the 29th of March next year.”
Asking prices of new stock entering the market rose by just 1% last month – the lowest rate of asking price growth for October recorded by Rightmove since 2010. In addition, Nationwide has reported that monthly sale prices remained at a standstill, and the annual rate of house price growth of 1.6% is the lowest rate seen for over 5 years.
Richard suggests that these circumstances could provide real opportunities for those buyers who are ready to trade up in the second quarter of 2019.
He explained: “There’s no doubt that trading conditions have been pretty sedate in the past few months. Even the traditional spike in market activity ahead of the run-up to Christmas has failed to materialise.
But the Budget offered the sector a few crumbs of comfort. The additional 1% Stamp Duty Land Tax for non-resident buyers was lower than the 3% previously suggested, and the two-year extension to Help-to-Buy should assist first-time buyers who want to get onto the property ladder.
What’s more, despite the risks involved in the current challenging market conditions, we expect that come April 2019, those hoping to trade up will find that the gap in sale values and onward purchase prices will be the narrowest it has been for half a decade. So there continue to be real opportunities out there.”