What does Brexit mean for your house move – now and after 31st October?
With Brexit less than ten weeks away, there’s been a summer swell in house sales. But is it best to move now, or wait – and, if so, for how long? We ask leading property experts for their advice on what you need to think about before you make your next move.
August 21, 2019
Should I sell before Brexit or wait?
Here at the HomeOwners Alliance, our phone lines and inbox have been inundated recently with queries from people wondering what Brexit means for their plans to move house. Should they put their home on the market before Brexit or wait?
We’ve also had enquiries from people struggling to sell, or to find a suitable home because of fewer properties for sale. Plus we’ve had questions from house buyers wondering if they should renegotiate their offer price in light of a possible no deal Brexit.
Although house prices have been climbing fairly constantly since 2012, after the June 2016 referendum the pace of growth has been sluggish. Figures from the Office for National Statistics show the house price growth rate was only 0.9% to the year ending in June 2019, compared to the 8.17% in the year ending June 2016.
Yet, according to new stats from Rightmove, there has been a last minute summer surge in property sales amongst those who’ve opted to move before the Hallowe’en Brexit deadline. A record 6.1% rise in house sales took place in the month up to 10 August, compared to this period in 2015.
What Brexit means for your house move
So with less than 70 days till October 31, and the likelihood of a no deal Brexit high, we’ve sought the views of a range of industry experts on whether those considering selling a house should sit tight or get on with their house move.
Post-Brexit bounce possible
Buying agent and market commentator Henry Pryor recently tweeted: “Rather than seeing a significant fall in house prices, I can see an argument that the market could actually bounce once we have some clarity over Brexit.”
He told us: “Brexit is a distraction and it seems unlikely that it will fundamentally undermine the housing market whatever the manner of our departure. Is it unsettling people? Sure. Is it likely to lead to a house price crash? No.”
He adds: “There is a market. You can buy and sell and about 40% of sellers understand that what they might lose on their sale they can expect to make up on their purchase.
“What both buyers and sellers need to understand is that Hallowe’en is only the start. We will have two or even three years following Brexit during which we will have to rearrange the deals, rules, laws on everything from import taxes to agricultural subsidies.”
Keep Calm and Carry on
This was the view of the majority of experts we asked. Will Clark, Managing Director of myhomegroupltd.co.uk, says: “When you assess the reasons for needing or wanting to move home or sell a property, 99% of the time it is due to human factors, not political.
“My advice for anyone looking to sell or thinking of selling is simple: you can wait for the aftermath of Brexit but you’ll then be faced with Christmas only a few weeks away. Realistically waiting for the 31st October means holding off until mid to late January 2020. Of course, we’ll know where we stand on Brexit but we still won’t have clarity on the economic climate.
“Factor in a further four months, the current average sales time for properties in the UK, and you find your self completing on your home earliest June 2020! Remember stiff upper lip, keep calm and carry on.”
Similarly Sam Mitchell, CEO of online estate agent Housesimple, says: “Life does not wait for politics to calm down and neither should sellers. Who knows what will happen post Brexit but the worst thing people can do is sit on their hands and take the ‘wait and see’ approach as this is what will run the risk of bringing the property market to a standstill.”
Careful borrowing and the Budget
David Pett, Director and Solicitor at MJP Conveyancing recommends first time buyers to buy now as opposed to waiting, but to bear in mind a possible recession and possible job losses in the event of a no deal Brexit.
He says: “For first time buyers, subject to what I say about possible job losses, this is the time to strike. Interest rates remain low, and may be reduced even further, and with low increases in price, it should be cheaper to get on to the property market.” So first time buyers will need to make sure they stress-test their monthly payments before committing to mortgage borrowing.
However, he advises those selling pricey homes to wait until the autumn budget, expected in late October. He says: “If I was purchasing a high value property I would consider waiting for the budget to see what cuts if any are made to thresholds of stamp duty.”
Weigh up whether to wait – or renovate
Russell Quirk, Property Expert and Co-Founder of Properganda.pr agrees there will be a post Brexit bounce, but advises sellers to sit tight rather than consider a house move now: “I sincerely believe that the market is in a state of paralysis, but that once the shackles of Brexit are unlocked and economic and political certainty return in 2020, that we will see a post-Brexit bounce with pent up demand unleashing itself. This combined with the lowest mortgage rates ever, is a cocktail of fuel that will drive prices higher in 2020/ 21.
“So, I would wait until January or else you’ll be caught in the headlights of the current stalemate and won’t achieve the price that you might from January onwards.”
But if you wait you might miss out. David Hollingworth at L&C Mortgages, recommends those who need to sell to weigh up their options. “If you’re hoping to sell now in the expectation of a dramatic fall in prices you will of course be taking a gamble,” he says.
“However, if there’s a property that you want to buy now, there’s absolutely no guarantee that it will still be available in a few months time and you could risk losing out.”
Meanwhile, Nick Stockley, Head of Design at Resi, the UK’s largest residential practice advises those who can to renovate instead of move. He says. “I personally wouldn’t advise anyone to sell their home until after Brexit actually happens now.
“At Resi we submitted 125 planning applications last month, the most that we have ever had since we started two and a half years ago. We had 3,000 people sign up this month too, showing just how many people are renovating rather than trying to sell.
“Many of these will have decided it’s better to stay put than sell their homes in such an uncertain climate. It’s a sensible choice.”
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