With next month’s Brexit deadline looming, the dark cloud that’s been hovering over the wider U.K. property market is finally expected to subside.
The U.K is scheduled to formally leave the European Union on March 29 which will, according to a report from international estate agency Winkworth, mark the beginning of the return of confidence and activity in the property market which has in recent years been plagued with cautiousness and uncertainty.
The report predicts a clearer outlook for the U.K. and more positive times ahead for the central London market despite the first quarter expected to be quite subdued as political turmoil comes to a head only weeks out from Brexit.
“Whilst activity and prices are still below peak levels, the market has now leveled out. With a steady market comes improved confidence which should feed through to an increase in activity later this year,” said Dominic Agace, Winkworth CEO.
Property transactions fell a whopping 33 per cent in Q4 2018 compared to the previous quarter which the report says is likely the result of an increase in uncertainty surrounding Brexit discussions.
“As we gain further clarity on Brexit and dependent on whether we leave with a deal, we should start to see an uptick in activity,” Mr. Agace said.
If Winkworth’s predictions prove to be correct, Brexit will be the platform which will see the U.K. property market recover and ultimately prosper in the long-term.
According to a recent report from Savills, home prices in the UK are expected to rise almost 15 per cent over the next five years, adding £32,000 to the price of the average home by 2023.
Savills expects the North West of England – especially Manchester – to be the biggest beneficiaries of the market revival with prices in the region expected to rise 21.6 per cent. Conversely, they expect London’s prices to rise 4.5 per cent during the same period.
“Brexit angst is a major factor for market sentiment right now, particularly in London, but it’s the legacy of the global financial crisis – mortgage lending in particular – combined with gradually rising interest rates that will really shape the market over the longer time,” said Lucian Cook, Savills’ head of residential research.