There’s no denying that Brexit has been a divisive issue since the referendum vote of June 2016. And while we don’t formally leave the EU until March 2019, there have been various effects on the economy and, of course, property.
While the initial burst of doom and gloom predictions surrounding the economy didn’t come to fruition, there has been a surge of interest in property around the UK which has boosted regional areas.
London prices fall
The major effect on property has been seen in London. Property prices in the typically robust investment stronghold have fallen by as much as 15% over the last couple of years.
For example, the average price of a property in Wandsworth (an area that covers most of Clapham, Putney and Balham) has fallen by more than £100,000. What was once the centre of the UK’s property boom, has become rather less impressive. In January 2017, properties in the London borough of Wandsworth were reaching an average price of £905,000. Fast forward to February 2018, and the same property is now averaging £685,000.
Figures from research undertaken by estate agency Your Move has shown just how far property prices have fallen in London. But it has also shown that other areas of the UK are enjoying a house price boom.
Property prices are doing particularly well in the north of England, with Blackburn showing the highest growth rates in the entire country. Other regions in the north and the far south are showing signs of increased property prices.
Other boroughs in London also showing the steep decline in prices include Southwark, where the average property price has dropped from £666,000 to just £585,000 over the last 12 months. Similarly, north London’s borough of Islington has seen average prices slip from £750,000 to £684,000.
The areas of Southwark and Wandsworth had become renowned for the proliferation of large, speculative property developments looking out to the Thames. These include the likes of Battersea Power Station’s development. However, the market for one-bed properties costing more than £1 million has deflated over the last few years.
The research shows that average prices across London were down by 2.6% over the last 12 months and have now decreased for three months consecutively. This shows the steepest annual rate of decline in prices since the last major housing crisis of August 2009. This was the direct result of the banking crisis of 2008.
Investors move away from capital
Property investors are turning away from London’s property and eyeing up developments in second-tier cities away from the capital. The north west is the fastest growing hotspot, with Blackburn recording average prices jumping 16.4% over the last year.
Warrington is another northern city enjoying a boost in house prices, which are up by 10.3%. Manchester prices are up 4.3% and in Merseyside property prices are up by 8%.
Prices have increased nationally by 0.5% on the month. The slowdown that began in London has now spread to the north east and south east of England as well, which have also seen prices fall.
Research from Halifax also backs up the fact that the property market nationally has slowed somewhat. Additionally, official data is showing that wages are currently outpacing house prices, which is unusual.
It remains to be seen how the market will pan out for the rest of the year as we approach March 2010, however, it’s encouraging to see investment going into areas outside of the capital.