• 22nd August 2016

    Investment Management

    Brexit hasn’t blown the housing market down (yet)

    The UK vote to leave the EU has yet to have a real impact on the housing market, according to Grainne Gilmore, Head of UK Residential Property Research at estate agent Knight Frank.

    In our latest podcast, she tells Ben Gutteridge, Brewin’s Head of Fund Research, that “so far it’s business as usual” and it will be the autumn before the effect on house prices and activity of the decision to leave the EU becomes clearer.

    The Brexit vote has hit confidence and there has been some adjustment down in asking prices on properties since. But Gilmore notes that mortgage rates are being reduced following the Bank of England’s cut in base rates to 0.25% earlier this month, which is “helping to underpin the market and confidence”.

    She also references the ongoing “supply-demand imbalance” in housing, with about 160,000 homes being built a year against an annual requirement for about 300,000 additional properties.

    Gilmore describes the UK housing market as “multi-speed”, with evidence of an existing slowdown in London ahead of the Brexit vote and modest falls in prime central areas of the capital following recent stamp duty increases. In areas like Knightsbridge and Chelsea, price falls have been up to 6% or 7% over the last year, she says.

    However, the weakness of the pound since the Brexit vote gives people buying in overseas currencies an “effective discount”, making UK property a potentially attractive investment for them.

    Outside of London she also highlights how the market is stronger in urban areas – where economic activity is concentrated - than rural regions. She points out that brownfield land prices in urban areas are up 9% year-on-year, whereas English greenfield and prime central London land prices have fallen over the past year.

    On buy-to-let she says that rents are still rising overall in the UK, but increased letting stock in prime areas of London and parts of the South East is putting pressure on rents in those areas. With the private rental sector (PRS) continuing to grow, there is still demand for lettings, she adds.

    The new government has yet to spell out its housing policy. But on the continuing supply shortfall, she says that while the planning regime is key “I don’t think there is a silver bullet. It’s about implementing different strategies at different points in the housing supply chain.”

    To listen to this or other Brewin Dolphin podcasts, go to www.brewin.co.uk/sharing-our-thinking/podcasts

     

    The value of investments can fall and you may get back less than you invested.

    The information contained in this document is believed to be reliable and accurate, but without further investigation cannot be warranted as to accuracy or completeness

    All information within this article is for illustrative purposes only and is not intended as investment advice.

    The opinions expressed in this podcast are not necessarily the views held throughout Brewin Dolphin Ltd.

    We or a connected person may have positions in or options on the securities mentioned herein or may buy, sell or offer to make a purchase or sale of such security mentioned in this podcast.

You might also enjoy...

How can we help?

020 3201 3900

01224 267 900

Graeme Bowden

07880 087347

graeme.bowden@brewin.co.uk

020 3201 3363

020 3201 3483

028 9044 6000

Stephen Cartwright

02890 446004

Stephen.Cartwright@brewin.co.uk

020 3201 3363

020 3201 3483

0121 710 3500

Paul Cox

07768 164067

paul.cox@brewin.co.uk

020 3201 3363

020 3201 3483

01202 312 500

Andy Wheeler

07771 724625

A.Wheeler@brewin.co.uk

020 3201 3363

020 3201 3483

0117 968 9500

Jason Williams

07766 725268

jason.williams@brewin.co.uk

020 3201 3363

020 3201 3483

020 3201 3050

Ross Slater

07920 590425

ross.slater@brewin.co.uk

020 3201 3363

020 3201 3483

029 2034 0100

James Gadd

07833 048452

james.gadd@brewin.co.uk

020 3201 3363

020 3201 3483

01242 577 677

Jason Williams

07766 725268

jason.williams@brewin.co.uk

020 3201 3363

020 3201 3483

+353 (0)1 260 0083

Suzanne Cashin

00353 1 2682837

Suzanne.Cashin@TilmanBrewin.ie

020 3201 3363

020 3201 3483

01382 317 200

Graeme Bowden

07880 087347

graeme.bowden@brewin.co.uk

020 3201 3363

020 3201 3483

01473 267200

Ross Slater

07920 590425

ross.slater@brewin.co.uk

020 3201 3363

020 3201 3483

0131 225 2566

Graeme Bowden

07880 087347

graeme.bowden@brewin.co.uk

020 3201 3363

020 3201 3483

01392 440 450

Philip Thitchener

07920 190683

philip.thitchener@brewin.co.uk

020 3201 3363

020 3201 3483

0141 221 7733

Maxine Anderson

07901 977929

maxine.anderson@brewin.co.uk

020 3201 3363

020 3201 3483

01534 703 000

Antony Champion

07557 480075

antony.champion@brewin.co.uk

020 3201 3363

020 3201 3483

0113 245 9341

Owen Woolfitt

07920 801390

owen.woolfitt@brewin.co.uk

020 3201 3363

020 3201 3483

0116 242 0700

Paul Jackson

07500 797776

paul.jackson@brewin.co.uk

020 3201 3363

020 3201 3483

01522 503 000

Paul Jackson

07500 797776

paul.jackson@brewin.co.uk

020 3201 3363

020 3201 3483

020 3201 3900

London Sales Support

0203 201 3363

londonsalessupport@brewin.co.uk

020 3201 3363

020 3201 3483

0161 839 4222

David Ryan

07795 665861

david.ryan@brewin.co.uk

020 3201 3363

020 3201 3483

01672 519 600

Susan Hazelwood

07920 496265

susan.hazelwood@brewin.co.uk

020 3201 3363

020 3201 3483

0191 279 7300

Lucie Gordon

0191 279 7325

lucie.gordon@brewin.co.uk

020 3201 3363

020 3201 3483

0115 852 5580

Paul Jackson

07500 797776

paul.jackson@brewin.co.uk

020 3201 3363

020 3201 3483

01865 255 750

Susan Hazelwood

07920 496265

susan.hazelwood@brewin.co.uk

020 3201 3363

020 3201 3483

01768 861 710

Lucie Gordon

07467 339228

lucie.gordon@brewin.co.uk

020 3201 3363

020 3201 3483

01752 334 650

Philip Thitchener

07920 190683

philip.thitchener@brewin.co.uk

020 3201 3363

020 3201 3483

01737 223 722

Andy Wheeler

07771 724625

A.Wheeler@brewin.co.uk

020 3201 3363

020 3201 3483

01743 399 000

Brian Boyd

07825 732007

brian.boyd@brewin.co.uk

020 3201 3363

020 3201 3483

020 3201 3363

020 3201 3483

020 3201 3363

020 3201 3483