What would ‘Brexit’ mean to the 5,880 Stamford property owners?

If you read all the newspapers the Brexit debate seems to be focused solely on central London. Many commentators have said Brexit would cause central London to have a lower standing in the world, with higher unemployment rates along with the implication of lower wages and higher crime figures... but we are in Stamford, 103 miles away from central London.

What would Brexit mean for the 5,880 property owners of STAMFORD?

 

 

In the run up to the vote on the 23^rd of June, I predict the ‘IN’ camp will start to scare homeowners with forecasts of negative equity, and the ‘OUT’ camp will appeal the ’20-somethings’ (who have been priced out of the property market) with the prospect of a new era of inexpensive housing.  That is, should the fears of central London estate agents and developers who believe the bottom will fall out of the market if we do leave, become real.  

With the short-term uncertainty in the country, quite often big decisions are put on ice and people hesitate over ‘big money purchases’ i.e. buying a property. However, in the 4 months up to last year’s election, property values in Stamford increased by 1.76%.   Not bad for a country that thought it would get a hung parliament!

I believe that a vote to stay in the EU would see the Stamford property market return to a status quo very quickly, but the contrasting result could lead to some changes. The principal menace to the housing market could be a rise in interest rates as a result of a Brexit, which could theoretically see the cost of mortgages grow swiftly, pricing many out of the market … but then 75% of landlords buy without a mortgage, so that won’t affect them.

Also, according to data from the Bank of England, 80.33% of all new mortgages taken out in 2015 were fixed rate.  Looking at mortgages as a whole, 44% of all UK mortgagees have a fixed rate mortgage, but 56% don’t. 

I suspect whatever decision the electorate of Stamford and the country as a whole makes, over the long term it won’t have a major effect on the Stamford property market. We have seen off ‘the end of the world’ credit crunch of 2008/9 and subsequent property crash, the 1988 Nigel Lawson induced post dual-MIRAS property crash, the 1979 ‘Winter of Discontent’ property crash, the 1974 oil crisis that stimulated another property crash ... we can even go back nearly a century with the 1926 post General Strike slump in property prices...

Today, property prices are 241.83% higher than 21 years ago in Stamford and are 4.2% higher than 12 months ago.

So, make your own decision on 23^rd of June 2016 safe in knowledge that whatever the result, there might be some short term volatility in the Stamford property market, but in the long term (and property investment is a long term strategy) there aren’t enough houses in Stamford to live in either to buy or rent. 

 

Until the Government allow more properties to be built the Stamford property market will be just fine - even if it has a little blip in the summer, there could be some property bargains on the run up to Christmas to be had!

For more advice and opinion on the Stamford property market, even where those buy-to-let bargains could be found, visit www.rutlandandstamfordpropertyblog.co.uk

 

 

Data sourced from Land Registry, Census 2011, Bank of England and MIRAS