With news that the pound has hit its highest level at more than $1.40 since Britain’s vote to leave the EU in June 2016, the UK housing market appears to be holding its own in the face of a difficult climate.
The date for Britain’s exit from the European Union has been set for March 2019, but Prime Minister Theresa May has faced ongoing criticism for the relatively little progress that’s been made towards agreeing the terms of the exit.
However, despite all the ensuing political and economic uncertainty surrounding Brexit, which came to the fore in 2017, the property market has arguably remained buoyant. As of the end of last year, the number of property transactions in the UK totalled just over 1,223,400, which is just a 0.58% reduction on 2016’s figure of 1,230,580. When taking the potential detrimental effects of Brexit into account over the past 12 months, the figures released by HMRC are a positive outcome for the market.
Solid performance predicted
On an international level, commercial property investment has also fared extremely well, which may surprise many economists who had predicted the worst. The latest figures from BrickVest have revealed that the UK overtook Germany as the top place in the world to invest in the commercial sector. A reported £55bn was invested into commercial property last year, and a similar figure is forecast this year.
Regarding the residential transaction volumes, Brian Murphy, head of lending for the Mortgage Advice Bureau, said: “For the numbers for 2017 to be so close to the previous year does indeed suggest that we’re going into 2018 with the market in solid shape, which may be assisted yet further by the introduction of the SDLT scheme for first-time buyers along with newly released competitive deals from mortgage lenders which have seen some rates released in the last couple of weeks lower than they were before the interest rate rise in November.”
Taking advantage of the north
While the demand for housing in London hasn’t inflated at the same rate, it seems the figures are being upheld by major growth in other parts of the country, including the midlands, the north-west and the south-west. Property prices in the capital have started to peak and level out due to lack of affordability and reduced demand, meaning less transactions have taken place, while the better value for money seen in other regions has supported the market.
Jeremy Leaf, former RICS residential chairman, said: “We’re now seeing buyers who are deciding that they won’t put up with the lifestyle compromises required to purchase and live in London and who would rather take advantage of what’s available elsewhere, and with improving transport links this is now become more prevalent over the last twelve months than we’ve previously seen.”
