Another week, another Brexit blow for Theresa May, and yet more uncertainty to further cloud the minds of property buyers and sellers.
Much of the markets demise of late has been attributed to this ‘uncertainty’, which has increasingly ramped up as things have evolved, first from the ponderings of what the reality would be once we had left the EU, then to what sort of deal we might secure, and now to whether or not there will even be a deal, or a Brexit for that matter.
This, what if scenario has left both UK buyers and sellers in a property cycle limbo.
On the one hand there are deals to be had as asking prices have slowly adjusted to the current climate. However, many potential buyers live in fear of committing to an investment that has become safe as houses in previous years, only to see the value of their bricks and mortar plummet due to a messy European divorce.
On the other side of the fence there are sellers who have become almost spoilt by the ever-escalating value of their property and to sell now at a slightly adjusted asking price would be an insult. So instead, they’re holding out, waiting for stability to return and price growth to once again accelerate.
The consequence of this drawn out period of fence sitting for both buyers and sellers has been a reduction in buyer demand, the resulting slow in property transactions this brings, and a rate of house price growth that is up and down like a yo-yo depending on which particular indices you follow.
Is there a plus side?
Well the UK property market is fiercely resilient and historically cyclical. What comes up must come down, but in the case of the UK market, it always comes back up. While a crash is unlikely, and our current political circus is inconvenient, we’ve weathered worse before and once the dust has settled the market will wipe itself down and return to full strength – fuelled by a nation of aspirational homeowners.
The only question is, how long the road to recovery will be and this is largely reliant on the distance the market continues to travel with these warning lights showing.