Even the sanest person in Britain has to admit the Brexit vote will, in one shape or another, affect the UK Property market. Excluding central London which is another world, most commentators are saying prices will be affected by around 10%. So looking at the commentators’ thoughts in more detail, property values in Canterbury will be 10% lower than they would have been if we hadn’t voted to leave the EU.
As the average value of a property in the Canterbury City
Council area is £266,800, this means property values are set to drop for the
average Canterbury property by £26,680 … batten down the hatches .. soup
kitchens and mega recession here we come ..it’s going to get rough.
.. but before we all go into panic mode in Canterbury .. the
devil is always in the detail
Look at the phrase again, and I have highlighted the relevant
part “Property values in Canterbury will be 10% lower than they would have been
if we hadn’t voted to leave the EU”
Property values today, according to the Land Registry are 8.91%
higher than a year ago in the Canterbury City Council area. The 12 months
before that they rose by 9.68% and the 12 months before that, they rose by 8.9%.
If we hadn’t voted to leave, I believe on these figures, we could have safely
assumed Canterbury House prices would have been 9% higher by the Summer of
2017.
… and that’s the point, we won’t see a house price crash in Canterbury,
it’s just that house prices in a years time will be 1% lower than they are now
(i.e. 9% less the 10% lower figure because of Brexit). Let’s look at the
historic figures and how that compares to today’s figures for the Canterbury
City Council area and Canterbury as a whole.
Average Value of a property 20 years ago £ 55,300
Average Value of a property 10 years ago £182,400
Average Value of a property 2 years ago £223,400
Average Value of a property 1 year ago £245,000
Average Value of a property today £266,800
Projected Value of a property in 12 months’ time £264,100
Therefore, I believe the average value of a Canterbury
property will be £2,700 lower in 12 months’ time than today.
That’s not to say Canterbury property prices might not dip
slightly in the run up to Christmas (in fact they always have done just about
every year since the year 2000 and most of those were boom years) .. but in 12
months time this is my considered opinion of where Canterbury property values
will be.. and looking at the historic prices, even if I (and many other
property market commentators) are wrong and they drop 10% from TODAY’S figure
.. in the whole scheme of things, we have been through a Credit Crunch, Black
Monday and 15% interest rates over the last 20 to 30 years .. and still Canterbury
house prices have always bounced back.
Whilst the UK's vote for Brexit has created an uncertainty
in the Canterbury housing market, there is no need to panic and prospective
buyers should merely use common sense about their purchases. I always say to people
to be prudent and if you are taking out a mortgage, at some stage during the
life of that mortgage, circumstances will be difficult. We won’t have a 2008
Credit crunch fire sale of properties because after the Mortgage Market Review
which took place in the Spring of 2013, mortgage borrowers are not as highly
leveraged this time around. As a result of this, with any luck there will
not be too many distressed sales, which cause widespread price reductions.
.. and Canterbury landlords? They have recently been thrashed
by Osborne’s tax changes, but yields could rise if Canterbury house prices fall/stablise
and rents grow, and this might also make it easier to obtain mortgages, as the
income would cover more of the interest cost. If prices were to level or come
down that could help Canterbury landlords add to their portfolio, as rental demand
for Canterbury property is expected to stay strong as more people find it more
and more difficult to obtain mortgages.
For more thoughts on the Canterbury Property market visit
the Canterbury Property Blog at www.canterburypropertyblog.com
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