James Fearn, Managing Director of Keats Fearn, believes so-called ‘expert’ predictions of an imminent property market crash following Brexit are ill-founded, uninformed and genuinely misleading, amounting to no more than scaremongering, a trend much loved by the media.
When we turn our minds back to the spring and early summer of 2016, says James, we will recall the dire predictions of doom from Cameron and Osbourn about what would happen if the country voted to leave the E.U. Cameron promised he would sign Article 50 the next day and our world would sink into chaos immediately thereafter – the pound would fall in value, the stock market would be decimated, interest rates would rise, house prices would fall, and a plague of pestilence would descend over the land. O.K. he didn’t actually say those last words about plague and pestilence, but that was the vision he was forecasting!
In the event, what actually did happen to these predictions, endorsed by 2 of our most senior politicians, the Prime Minister and the Chancellor of The Exchequer? Well, first of all, Cameron quit in a huff, most probably because he did not believe his own rhetoric, the pound gained in strength, the stock market reached a series of all time peaks, interest rates stayed at their historic low for a further 2 years (and are still less than 1%, and forecast to remain close to this level for some time), house prices in most parts of the country outside London have continued to rise, and with the exception of the Novichok scare in Salisbury, there has been no sign of plague or pestilence in the U.K.
The fact of the matter is, continues James, that the property market is one of the main keystones of our economy, and no government in its right mind can allow it to crash. If it did, developers would stop building new homes, the construction industry, another keystone of our economy, would collapse, closely followed by the car sales market and then the retail trade in general.
Only last week, it was announced that we need to build 400 new homes every day for the next 5 years just to keep up with current demand. If the government allow property prices to fall dramatically, these homes will simply never be built.
So, whatever the outcome of the Brexit negotiations, whether it be ‘deal or no deal’, we can be sure that whichever political party is in charge thereafter, positive steps will be taken to safeguard the property market, in order to secure the economy as a whole.
As soon as the political uncertainty over the current negotiations is over, we can rest assured that the property market will turn around quickly, as the number of sales increase, and the strong probabilty is that prices will continue to rise. An Englishman’s home has long been described as his castle and there is absolutely no reason to doubt that this will change in the foreseeable future.