What is happening in the London market post Brexit?
By Jo Eccles
Q: Three months on from Brexit, what’s happening in the London property market?
A: In the immediate aftermath of Brexit, most unmotivated sellers withdrew their properties from the sales market, choosing either to hold on to them, or rent them out instead. As a result, the sales market pretty much froze for the whole of July as buyers and sellers digested the news.
This has definitely changed over the past five weeks. The pent up demand from buyers that we saw before the vote has fallen into two camps; those who view now as a good time to buy, and those who are still keen to buy but have put their purchase plans on hold for the short to medium-term.
Prices have softened approximately 5-10% since Brexit, and a lot of buyers have concluded that now is a good time to buy and I don’t believe we will see further price drops this year. Some leading research analysts predict price falls this year, which we’ve already seen, then expect prices to remain flat over the next two years, followed by price increases after that.
Because only genuinely motivated sellers are participating in the current market, now is actually a really nice market to be buying in. Sellers are open to sensible prices and they really do want to sell.
You do need to be careful about pricing though. Some properties have advertised, say, 10% price drops since the referendum, but remember that the pre-Brexit prices may have been inflated, so the 10% lower post-Brexit price may not represent a genuine discount. It’s therefore really important to do your sums correct, or hire a buying agent who will be able to advise you on value and negotiate more effectively for you.
Many sellers are in chains or want a quick sale, so if you’re able to move quickly then you’re definitely at an advantage. We recently secured a property for a client for £18,000 less than a competing buyer because we positioned her as being in a better buying position and the estate agent knew we would get the purchase exchanged very quickly.
So if you do want to buy, then now might be the right time to jump in!
If you have a question you’d like Jo to answer please email Jo.eccles@SPpropertygroup.com or tweet her @joeccles.