It is hard to predict what the effect of Brexit will be for property prices this year as the property market itself is constantly evolving and changing as it is. More so now that it’s combined with uncertainties remaining over Brexit, not just in Northern Ireland but the rest of the UK as well.
The market is always in rhythmical motion that depends on a large number of factors, including but not limited to:
- mortgage product offerings;
- the supply of new-build housing in the area;
- seasonal patterns around school schedules and holidays; and
- economic confidence giving rise to more home movers.
The possibility of a no-deal Brexit will be a major factor at play in the fortunes of the market for a considerable time to come. It is important to understand where the market is currently at if we were to consider the impact of a no-deal Brexit.
The property market in Northern Ireland been driven by first-time buyers for a time now, specifically to those who have an appetite for new build properties.
On the other hand, long chains of sales and purchases are currently not observed—especially during this COVID-19 pandemic—as opposed to that of a typical prior to and during the property boom which leads to home movers not having sufficient confidence in property values and the economy. The main concern now is how the supply of new houses will likely be affected.
There is no doubting that there will be a great deal of hesitancy to commit to new large scale developments while a no-deal Brexit is a genuine possibility if builders and developers were cautious at the prospect of Brexit with a deal. Needless to say, the economic outlook has been deteriorating and is likely to continue to do so following Brexit.
The Construction Employers Federation (CEF) reported that 28% of firms already made redundancies while another 48% are considering to do the same in the next months to come. The property market is currently facing the most challenging conditions since 2012.
The supply of new houses will certainly decrease which then will lead to a decrease in sale transactions. A property’s value, on its own, will never be an indicator of a healthy market. This means the lack of supply may definitely cause an increase in house prices because potential buyers will be competing for a lower volume of stock.
First-time buyer demand is constant. Affordability is an issue which will leave thousands of purchasers facing the familiar hurdle of coming up with a deposit or a downpayment for a house purchase. During this time, regardless if you are buying a residential property in Northern Ireland or selling or remortgaging your home, you should require a property conveyancing solicitor to handle the legal process. Wilson Nesbitt Property Conveyancing should be able to help you out.
Housing supply and buyer affordability will as such be the key issues. The effect Brexit (with or without a deal) has on housing supply and buyer affordability is still very much speculation. Whatever happens on 31 October, the Northern Ireland property market will surely find its gear and pick itself up, just as it has in numerous difficult times.