YOPA: House prices ‘could fall 4% this year’ as result of Article 50

[AvoidDebt]

Average house prices could fall between 3% and 4% this year as a result of Brexit being triggered.

The claim comes from online agent YOPA which has launched a ‘Brexit House Price Tracker’ that collates industry predictions and compares them to the indices from Halifax, Nationwide, Rightmove and the Land Registry.

Predictions have been taken from commentators including buying agent Henry Pryor, who predicts a 2% increase this year, as do Rightmove and Nationwide experts.

The tracker, which will be regularly updated, also uses predictions from Ray Boulger at John Charcol mortgage brokers, who thinks there will be a 1% increase, while Martin Ellis of Halifax has gone for between 1% and 4%.

YOPA has then taken an average of these predictions to predict 1.2% average growth.

However, the agent has pointed out that the Halifax house price index for January showed a 1.1% monthly drop, followed by a 1.1% increase in February, while Nationwide recorded growth of just 0.2% and 0.6% over the same period.

A spokesman for YOPA said: “With Article 50 set to be invoked before the end of this month, many home owners and residents looking to get a foot on the property ladder are keenly watching how Brexit will affect the nation’s house prices.

“Looking at house price data over the past two years, we can see that all the major house price indices are showing a marked slowdown in growth since July 2016 – the month of the Brexit vote.

“It’s also been a rough start for 2017 with Nationwide, Halifax and Rightmove all showing a decline in house prices during January.

“In January, experts were predicting that 2017 would see a 1.2% increase in house prices, but using YOPA’s tracker we can see that so far this year house prices have actually declined.

“In fact, if 2017’s house prices continue at their same downward trajectory then we would be looking at a 3%-4% decline for the year.

http://www.propertyindustryeye.com/yopa-brexit-house-price-tracker-predicts-3-4-market-drop/

[billybong]

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Quote

A spokesman for YOPA said: “With Article 50 set to be invoked before the end of this month, many home owners and residents looking to get a foot on the property ladder are keenly watching how Brexit will affect the nation’s house prices.

“Looking at house price data over the past two years, we can see that all the major house price indices are showing a marked slowdown in growth since July 2016 – the month of the Brexit vote.

Of course the crazy level of house prices couldn't have anything to do with "a marked slowdown" in house price growth and not even one of the possible causes of Brexit itself.

Edited March 17, 2017 by billybong

[council dweller]

Oh...so we were told that it would take 10 or was that 20 years of talks to get free from the EU ?

So 20 times 4 is a....a very lot. Bring it on ?

[assetrichcashpoor]

Could brexit be the trigger that knocks down this house of cards? I think the consensus here is that although there is a lack of supply in the housing market the deficit alone isn't the main reason why houses are so expensive. The main reason has been easy credit which has driven up house prices to the eye watering levels they're at now. Banks are confident to lend as there is a perception that the housing shortage is much greater than it is and buyers are still willing to buy because they think prices only go up (since I've been an adult prices in the SE have never fallen).

Would brexit remove confidence from the housing market, i.e. brexit causes a smallish drop, the banks get a bit jittery and stiffen up their lending criteria, people start thinking the market is falling so put off buying which creates a feedback mechanism? Admittedly it didn't happen in 2008-2009 the housing market fall was arrested by government intervention and by potential sellers were put off so the lack of supply helped sustain prices.