Northampton is currently one of the best places in the UK for investing in housing and the property market is in a fairly good state. As with other parts of the country, house prices were subdued following the initial Brexit decision over a year ago. While Article 50 was finally triggered a few months ago, most believe that the true impact has yet to be seen.
With negotiations now in full flow, what can house buyers and sellers, as well as buy to let landlords, look forward to over the next few years?
Article 50 Means More Stability
There are many in the industry who say that, despite the uncertain future, getting on with the Brexit negotiations is now going to provide more stability for the market. Housing depends a lot on this certainty and any shifts or hurdles in the negotiation process, however, are bound to have some kind of effect.
You can expect buying from abroad to continue, particularly from investors in China who are benefiting from the devaluation in the pound in recent times. This is something that could continue even if negotiations don’t go that well.
On the whole, experts believe that the housing market will remain fairly stable over the next year or so as we get into the nitty gritty of what Brexit actually means. The Brexit decision did reduce the number of people who were looking to move, however, and there has been an impact on house prices in areas like London, but less so in regions such as Northampton.
The Future and Article 50
The eventual triggering of Article 50 was generally expected at the time, so it didn’t have a massive impact on the housing market. Of course, that doesn’t mean we aren’t in for some choppy waters over the next two years. If the EU and the UK get along and there’s a real effort to strike a good deal, we should expect little or no negative impact. The problem arises if, however, there is more turmoil in the UK government with another election, something that could certainly delay or significantly change the terms of discussion over Brexit.
One significant impact could come from rising inflation. People may decide that renovating their home or adding an extension is preferable to finding a new property, which could cause a slowdown in the market. While banks are continuing to lend for mortgages, this could stumble if base rates start to rise. In areas like the North, we are still seeing rises in property prices, which is good news.
Renting and Article 50
How Brexit will impact on tenants is another issue that is far from clear. The market is booming despite changes to stamp duty and legislation that has made things more difficult for landlords. If a reduction in immigration does result at the end of the negotiations, that could conceivably mean more properties available and lower rents. For the moment, however, rents are still increasing more than house prices and rental demand is still high.
No one really knows the true impact of triggering Article 50 and where we will be in two or three years’ time. With house prices making that first time buy still beyond many people, the popular view is that things will remain fairly stable, if uneventful, over the next few years.