Whatever your opinion and however you voted, the undeniable fact is that the British public have decided we are leaving the European Union.
With Theresa May rapidly putting together her battle plan amidst attacks from both home and away about how to execute these delicate negotiations, our thoughts turn to how the outcome will affect the UK lettings market.
There’s No Use Crying Over Spilt Milk
At Oulsnam Lettings we are positive about the future and we don't think Brexit will actually have that much of an impact on the lettings market as it continues to prove its resilience in the face of such adversities as the 2007/8 recession and has been steadily growing for years. In fact, most estate agents now rely on their lettings division to be their stalwart of reliable income in times of uncertainty which is poles apart from the likes of the 70’s and 80’s when property rental was thought of as much more of a side-line activity.
Our predictions for the market changes in the following months:
- Increase of foreign investors looking to buy in the UK due to sterling losing value;
- Possible Short-term dip in the sales market when uncertainty will ripple throughout the economy. Less houses may be sold but it is unlikely to affect house prices;
- Higher number of people choosing to rent due to better flexibility whilst assessing the immediate outcome;
- Canny investors see the buy to let market as a huge buying opportunity.
Keep Calm and Carry On
It is important to remember that there is an element of control that can be kept throughout this uncertainty. Our economy is in a much better place than it was before the last recession and Britain has one of the strongest major economies in the world, growing by 0.2 percent in quarter one 2018*, our employment levels are at a record high and the banks are 10 times stronger than they were at the time of the last credit crunch.
Rent levels are unlikely to be affected drastically, though there may be an impact on London rents where prices have risen dramatically due to high demand. A change in migration policies may reduce the demand in the capital but it is not anticipated to affect any other areas dramatically.
Stiff Upper Lip
Some of the British stereotypes haven’t stood the test of time; not all men go to work in a bowler hat and I’m not sure we definitely join the end of every queue we see. However, British fortitude is one that, in my opinion, will fervently withhold whatever the EU members throw at us and so if we can hold our nerve we will get through this and work to keep the property market strong. For those investors who are most driven by capital growth this is of course very important. For those investors looking for high yields, the next few months may well be the perfect opportunity to negotiate a good deal.
*Source – The Office for National Statistics