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House prices to fall 1% as market bears the brunt of Brexit

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House prices are expected to fall 1 per cent next year due to post-Brexit economic fallout, according to Countrywide.

The property group says house price growth will weaken in the second half of 2016 in all regions except Scotland.

It is forecasting that house prices will only rise 2 per cent this year, compared to growth of 6.5 per cent in 2015 and 8.5 per cent in 2014.

Countrywide predicts the housing market will be hit by falling consumer confidence, reduced household spending and increasing unemployment levels.

High stamp duty is also expected to play a part.

Countrywide says: “The vote to leave the European Union has unsettled the UK economy as uncertainty surrounding the arrangements for decoupling from the EU and the effect this will have on trade and future economic growth.”

It expects house prices to rise towards the end of 2017 at a rate of 2 per cent, and for this to continue into 2018.

Prime property prices in central London are forecast to fall 6 per cent this year. Meanwhile greater London prices are expected to fall 1.25 per cent and then rise 2 per cent in 2017.

Countrywide chief economist Fionnuala Earley says: “Forecasts in the current environment are trickier than ever as the vote to leave the EU has thrown up many risks. Our central view is the economy will avoid a hard landing.

“However, the weaker prospects for confidence, household incomes and the labour market mean that we do expect some modest falls in house prices.”

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Comments

There are 6 comments at the moment, we would love to hear your opinion too.

  1. I suppose no-one will be admitting that its anything to do with the tax implications to buy to let owners that is basically going to kill off the buy to let market? 25% taxable income on all rents this year, increasing to 100% taxable income no matter what the payaways every year? Sometimes I wonder just how stupid people think we are to come up with this scaremongering claptrap. Its got nothing to do with Brexit – this has been on the cards since the government made BTL a BAD proposition for most.

  2. @lorna
    Totally agree, plus 1%, who cares! 10% may be worth reporting, this survey is a waste of time.

  3. Did house prices never fall before Brexit?

    However my prediction is Countrywide’s prediction will be wrong………….I therefore predict one of us will be correct

  4. Utter Crap!!!
    Are we in recession? No
    Have we been dropped as a customer by the rest of the world? No
    Have we saved ourselves from Communist Europe? Yes

  5. There does seem to be a significant portion of the population who, rather than accepting that we are leaving & make the most of it, seem wish for BREXIT to be a disaster

  6. So, slightly more affordable properties.

    Absolutely nothing to do with Brexit, but the consequences of domestic policy.

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