UK House Market - One Week On from Brexit
This has been an extraordinary summer of political and economic upheaval, the likes of which I cannot recall previously witnessing in the past during such a short time span.
On day one of so called “independence” day we were fortunate enough to see a good number of house sales continue to exchange of contracts and a few new sales created, but against the backdrop of shocking stock market downturns, a fast weakening pound sterling and political fall out from the referendum most people in the property industry were no doubt holding their breath waiting for the shock waves to hit the house market.
A week on and I am both pleased and relieved to report that, just as the referendum outcome was unexpected the property market has in fact performed very well during the last week against the odds and what could have been the outcome.
Yes, London is being hit but this is not a surprise from my perspective, because as reported in the early new year I felt London house prices had become over heated and were due a realignment. In recent years house prices in the Hampshire, Surrey and Berkshire counties had not been running away in stark contrast with the London market, which was mostly overheating due to overseas investors from countries such as China. So whilst London takes a dive, the real house market in our prime area of operation is in working order and has made it through the first week of Brexit with flying colours.
Some of the key indicators of the buyer confidence we experienced this week include the fact that not one sale fell through directly because of Brexit. This has been backed up in a report from Eye , reporting on a conveyancer based in Guidlford and London who reported that just two in 600 deals fell through since Brexit stating that concerns of an immediate and catastrophic downturn in the property market had been “massively overblown”.
Another key indicator is the fact that new sales agreed across all of our branches show an average of 97.6% of the guide price being negotiated (some examples include our Odiham branch where sales in the week were on average 99% of guide, our Fleet branch where sales agreed were also 99% of guide and our Hartley Wintney branch where sales agreed were on average 96% of guide prices). This in part is due to vendors taking a more realistic view of their pricing strategy, which resulted in a good result across town and country property sales in the last week.
It may have just been coincidence, but we also notice more sales from buyers in America for properties in Hurst, Berkshire and Odiham Hampshire. On Wednesday we also heard some encouraging words from developer Redrow who reported “long queues and strong reservations” at four new site openings last weekend immediately after the Brexit vote.
These early signs of a stable house market flags up that house sales outside of London are in the main influenced more by local factors such a jobs, schools as well as the personal matters affecting a family or individual.
In summary, a week on from Brexit and I think it is safe to say that we can take encouragement from the trading results and the buyer confidence, so if you would like a refreshing property appraisal then contact your nearest McCarthy Holden branch to arrange a free valuation. It could be better that anticipated!
John Holden - Chairman and Managing Director McCarthy Holden