House prices in ‘Leave’ areas outpace ‘Remain’

Since the Brexit vote, house prices have increased across the UK by 9.3%, with market uncertainty surrounding the exit being blamed for a slowdown in the rate of growth, according to Emoov.

Its latest research looked at market confidence amongst 1,000 UK homeowners and the state of the UK property market across both the Remain and Leave factions to see where house prices are performing best.

Some 24% of respondents said they didn’t know house prices would increase, while 28% had expected it to happen. Of the 21% who thought prices would have grown by less, 15% thought they would fall and 12% believed they should have grown by more.

Emoov then asked participants what they think triggering Article 50 will do to the market. Some 30% of participants believe house prices will continue to increase, with 28% thinking prices may flatline. Over a quarter (26%) of UK homeowners aren’t sure what will happen, while 12% think they will see a slight decrease. Just 4% think they will collapse.

No overall UK region has seen a fall in prices, and just 16 local districts have witnessed prices fall since the vote, down 3.3% on average, with only three home to a majority Leave vote: Middlesbrough (-0.1%), Darlington (-1.2%) and Spelthorne (-1.2%).

There was a total split across the whole of the UK, with the 270 districts that voted Leave seeing house prices increase by an average of 9.5% since June 2016. On the other hand, prices across districts which voted Remain have seen an average increase of just 5.0%.

In London, boroughs which voted Remain have seen an increase of just 1.8% since the vote, with house prices in boroughs with a majority Leave vote up 6.2%. The East of England is home to the biggest gap, with Leave areas up 9.1% to just 4.2% for Remain, with the West Midlands also recording one of the biggest gaps with Leave districts up 11.8% to just 7.3% in Remain areas.

Russell Quirk, founder and chief executive officer of Emoov, said that while Brexit uncertainty may have slowed the rate of price growth, it isn’t what is causing the ‘Armageddon-like’ scenario that many prophesised following the Brexit vote.

“Of course, there is a degree of uncertainty in the market, but this has most certainly been exaggerated and used as a tool to talk the market down for those hoping to swing a second vote,” he continued. “Ironically, it’s the areas with a Remain majority that have fared worse where house price growth is concerned.”

Quirk says this may also demonstrate a more business-as-usual attitude within the Leave majority markets, with those less phased about the implications of what they voted for stimulating both buyer demand and stock levels, while Remain areas are seeing both buyers and sellers still ‘sat on the fence’.

He finalised: “The UK market has overcome far worse than it’s current predicament and will no doubt continue to exceed expectations once our departure has been confirmed via Article 50.”