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How Will Brexit Affect The Property Markets?

How Will Brexit Affect The Property Markets?

The property market has stagnated since the referendum in June 2016. However, that doesn’t mean house prices have fallen – they have just risen at a slower pace. Mr Johnson has stated that he wants Brexit to take place on 31 October whether a deal has been agreed with the EU or not.

While MPs have constantly voted against the UK leaving the EU without a deal, the results are not binding in a legal sense. A no-deal Brexit remains the default if an agreement cannot be reached between the UK and EU. In July the Office for Budget Responsibility predicted that a no-deal Brexit would lead to house prices falling by almost 10% by mid-2021.

Looking further back, in September 2018 Bank of England governor Mark Carney warned that leaving the EU without a deal could send property values tumbling by a third, and in February this year he added that UK growth would be ‘guaranteed’ to fall in the event of a no-deal Brexit.

Finally, it’s important to remember that the fundamentals that drive house price growth remain the same – limited supply and historically low interest rates. So it’s unlikely we’ll see a house price crash unless these factors change significantly.

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