Despite the property market (and virtually everything else) remaining under the cloud of the pandemic, Brexit and its implications for the UK remain crucially important.
However, one area that seems to have remained impervious to any Brexit related decline is the UK housing market. Despite claims by the Bank of England that a worst-case scenario when leaving the EU could see house prices fall 35% over three years, research by Keller Williams UK has found that this has been far from the reality.
National and Regional Property Prices
While we’ve arguably avoided a worst-case scenario, Brexit has brought with it years of uncertainty as multiple prime ministers battled to get the job done. Despite this ongoing saga and the disruption, it has caused, UK house prices have climbed 14.1% since the vote in June 2016 until today.
This growth has been driven at a regional level by Wales and the Midlands. The East Midlands has seen the greatest increase in house prices since the Brexit vote at 20.9%, while values have climbed 19% in the West Midlands. Sandwiched between them, Wales has seen an increase of 20.3% in property values since June 2016.
Just London, the North East and South East have failed to register double-digit price growth. The capital has seen an increase of 3.2%, while property prices are up 6.7% and 9.2% in the North East and South-East respectively.
Current vs Previous Price Growth Rates
While house prices have continued to climb since the EU Referendum, it is important to note that the rate of house price growth has slowed. Keller Williams UK also compared the rate of house price growth since the EU Referendum to the same time period prior to the vote. The research shows that while house prices across the UK have increased by 14.1% since June 2016, they increased by 28.3% during the same time period prior to the vote.
A third of UK regions have seen the rate of house price growth since the vote exceed that seen in the same period prior to it; Wales, the North West, Yorkshire and the Humber and Scotland.
London has seen the biggest slow in the rate of house price growth. As mentioned, house prices in the capital have climbed just 3.2% since the vote while they boomed by 61.2% in the same time prior to it.
Leave vs Remain
Property prices in areas to have voted Remain in the EU Referendum averaged £302,688 when the vote took place in 2016. Since then, they’ve increased by 8.1% to an average of £327,316. However, in areas to have voted Leave, house prices have increased by 14.1% to an average of £232,976 today.
Just two of the top 10 areas for house price growth since the EU Referendum were home to a majority Remain vote. Newport has seen the largest increase at 31.7% having voted Leave, while Monmouthshire has seen the largest increase of all Remain areas and the second-largest increase in the UK at 30.5%. Leicester is the only other area to have voted Remain to make the top 10 with an increase of 28.2%.
In contrast, just three of the 10 areas for the worst house price growth since the vote are Leave areas; Bracknell Forest (-4.7%), Hartlepool (-1.3%) and Spelthorne (-1%). Aberdeen (-23%), the City of London (-20.9%) and the City of Westminster (-9.3%) have seen the largest declines in property prices since the vote.
Ben Taylor, CEO of Keller Williams UK, commented: “Regardless of whether you voted Leave or Remain and purely from a property perspective, you could argue that Brexit has provided the perfect tonic for the UK property market.
“Yes, a handful of areas have seen prices fall since the vote itself. However, the vast majority of the UK has seen the value of bricks and mortar continue to climb despite the rollercoaster ride that Brexit has been.
“At the same time, the rate of house price growth seen since the vote has slowed in 69% of areas. This won’t have addressed the outright issue of affordability that many face when trying to get a foot on the ladder. However it does, at least, mean that homebuyers are paying less than they may have otherwise while homeowners have still seen an increase in the value of their investment.”