Forum Topic

House prices and sales since Brexit

The article on the front page says property prices in Acton have not reduced since the Brexit vote... as might have been predicted.But it doesn't go on to say that the combination of the vote and the increase in stamp duty (presumably) has reduced the number of sales by 80%. that's A LOT of stagnation surely. And with Crossrail round the corner, surprising.Not much else has changed to reduce the number of sales so a combination of these two factors seems the most likely explanation, doesn't it?

Sara Nathan ● 3457d7 Comments

Exactly the same thing happened in Southern Ireland. A huge wave of development began and then when the economy went into meltdown in 2008 all construction ground to a halt and now the country is littered with half finished housing Estates that nobody lives in.

Bob Little ● 3456d

Acton gardens one the best thing that is happening in Acton at the moment

John Kennedy ● 3456d

There is no agent comment in the article which normally throws more light on what is happening. As they rarely miss the opportunity for a bit of free publicity their silence may be down to them not wanting to admit how bad things are. The comment from the RICS puts the fall in volume down to uncertainty over the referendum but suggests things are picking up.The really interesting thing about all this locally is alluded to in the article but not expanded on. I went passed the Acton Gardens site last week and was astounded by how much progress was being made. Yet the numbers are suggesting that flats in parts of the development that are completed are not shifting. Normally this would cause a developer to slow down construction to manage their cash flow. That they are not doing so strongly suggests that they have been guaranteed lines of credit to tide them over a time of slow sales. This is probably indicative of a new environment of state directed lending. The Government's ownership of much of the banking industry gives them new levers to manage the economy and under normal circumstances new home starts would have collapsed after Brexit. That they are not must show that the banks have been told to turn the taps on for developers. This could be storing problems up for later if the flats don't sell.

Paul Corcoran ● 3456d

I agree volumes down was mentioned - but I was looking for analysis - some explanation of why that might be the case - it's surely the most interesting part of the story.

Sara Nathan ● 3456d

Houses are massively over priced in London. This might help first time buyers get onto the ladder. Currently buy to let landlords are the main beneficiaries of inflated house prices.

Keith Iddon ● 3457d

Think that makes sense. In addition there has been a huge amount of monetary stimulus since the vote probably partly aimed at stabilising the property market. This already seems to have become a source of conflict within the Government with PMTM apparently not that happy with the direction of BoE policy and favouring higher interest rates. If she is as Machiavellian as many people think she is you may choose to believe that she would have liked a mini-property crash as it would have given her more leeway to make concessions in the Brexit negotiations. The current situation of an artificially inflated domestic asset market storing up problems for later is the worst of all worlds for her.The fall in volumes isn't ignored in the article in fact it is referred to in the title. Stamp duty changes are probably not the reason as there was a surge in activity in the first three months of the year before the change in April and then a collapse in the subsequent three months because many sales were accelerated through. There will have been a residual effect of the Stamp Duty changes in the latest numbers simply because property transactions are more expensive but chatting to a local estate agent she thinks the main problem is that there is a big gap in perceptions of what the state of the market is between vendors and buyers and therefore it is hard to agree on sale prices.

Paul Corcoran ● 3457d

I would guess that the uncertainty has caused home-owners to delay potential sales until the future of the country becomes clearer, for fear of falling prices. However, demand has remained strong and so the houses that are on the market have been able to command a premium. I must be supply constrained rather than demand constrained because prices are rising, not falling.

Alex Powrie ● 3457d