What does the election and Brexit mean for the 2020 property market?
Now the election is out of the way questions turn to what it all means for the UK property market for buy-to-let investors?
Will Brexit Get Done? Under what terms? And what does all this mean for the property market?
Has Brexit effected the UK property market?
It appears that Brexit has already caused plenty of uncertainty in the property market.
It’s true that house prices have fallen and fewer sales have taken place in 2019.
However, it impossible to accurately state the extent to which Brexit has influenced the figures.
And some say that the house-price slowdown is a natural market correction.
But if Boris Johnson fails to get his deal through Parliament there is a good chance we may leave without a deal.
And many experts across business and finance agree this could hit house prices severely – accountancy firm KPMG predict a 6% fall in house prices in the event of a no deal – but go on to say that in worst case scenarios this could fall as much as 20%.
The Office for Budget Responsibility said that a no-deal Brexit could lead to house prices falling by almost 10%.
And Bank of England governor Mark Carney said that UK growth would be ‘guaranteed’ to fall in the event of a no-deal Brexit.
What does Brexit mean for property investors and developers?
So what does this current situation mean for the property market for investors and developers?
Falling prices and recent price drops in some areas mean it could be a buyers market with some good deals available.
Combined with low mortgage rates it could be a good time to buy.
Of course this is tempered by the fact that many people are not selling their properties for fear of not getting a good price – so this means in some areas there is a lack of properties for sale.
Because of the stagnation and potential for prices to drop it is worth noting that if you are buying in this market it is worth buying for the long term.
That way if you are hit by any drops in price, losses should be mitigated in a few years when the market stabilises.
So with potential property deals available for those willing to hunt, and also with rents on the rise, now isn’t a bad time to be a buy to let landlord as long as you do your figures and ensure any deal really stacks up.
One eye also has to be on the new Government’s plans for laws for the private rented sector and immigration policies.
Will Brexit reduce the demand of those coming to rent in the UK from the EU or will demand increase from people outside the EU?
These will all become clear but one thing is for sure… more uncertainty awaits throughout 2020.
At M3 Commercial Finance we can help you secure property development finance.
Contact us today to discuss your needs.