Now that we are well aware of Brexit and that Britain will be exiting the European Union, its about time we really looked at the effects of how Brexit has taken its toll on the property market and the turbulent times to come in 2017.
Estate agents at the moment are feeling a great worry over the state of the property market, especially in upmarket once desirable areas like London. With many believing that Brexit has brought about increased taxes and higher property values, there are others checking out the possible benefits of making it big in the city.
Although 2017 shows a promising start and a vast improvement since 2016, we are not out of the waters yet!
All experts discussing Brexit are saying that it had a dampening effect on not only the property market but also the financial market. With a massive fall in sales and a period of uncertainty, sellers were decreasing their value in order to meet the increase in stamp duty costs.
Sellers were prepared to take a loss on market value to sell their property in the Brexit period.
Taking these steps did ease the property situation slightly but there is still a very long way to go to get the property market back to what it used to be. Before Brexit, the property market was in full swing moving forwards, but like any new developments the uncertainty sure rocked the boat and left Britain in a slump, especially London.
The debt market is supposedly slowing down and due to economic instability, buyers are less likely to enter the debt market. With this comes great difficulty for insurance companies who have invested a great deal of financial commitment into the property market already and are struggling to find room for any more allocations.
Buying Ages Will Change
As well as the property market slowing down the age of the buyers has also drastically changed. Since 2016, the decline in first-time buyers has been noticeable with rising house prices partly to blame. There is also a noticeable change in the age of property buyers over the years.
From 1981 to 2013/14 ages of 16-24 have decreased by approximately 20%. With the age bracket of 75+ actually increasing in homeownership, it’s no wonder that millennials and those fresh out of university are finding it hard to get on the property market and leave rented accommodation.
Urban Areas Vs. Countryside
All over the UK, we are noticing more homeowners wanting to move to country areas rather than urban cities. More homeowners are moving to the outskirts because of the hike in prices in the centre of desirable areas and with residential areas being more urbanised every day, the population rises in tandem. With countryside population set to increase by 6% over the next decade, 2017 could see more people in the rolling hills compared to the big cities.
With overcrowded areas, highly populated schools and smaller land spaces to occupy, more people are deserting the urban areas for spacious more rural countryside plots.
More Than Just Property
Politics, current trends, wages and even the environment alter the property market and can seriously affect the progression of a healthy property market. Although the government have continued to make changes to the current system, it has so far failed to make an impact on the collapse in the residential property market.
“A collapse in the residential property market that precipitates a recession is hardly the way to address the structural issues. Yet it should be clear that continuing with the pattern of pumped-up demand and inadequate supply will create problems”, Financial Times.
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