According to the company ReallyMoving, within one month after the fateful vote, the prices and volumes of property sales in the UK fell to an average of 8%. However, regional differences are very obvious. Hardest-hit were markets of London, near the capital regions (Kent, Surrey and Essex) and Northern Ireland. At the same moment real estate agencies of such countries as Spain, Portugal and Germany recorded a rise in demand from citizens UK.
The real estate market of the UK has a huge drop in the number of transactions
The volume of transactions fell by 12%. With regard to the usual summer decline (4%), fall of the total revenues after the vote is 8%. Average prices decreased by 8%, this is the biggest change in the last 5 years. However, in some regions when reducing the number of transactions, prices increase.
In London prices fell by 12% and sales volumes decreased by 44%. In the North-East of England and Northern Ireland square meters fell in price by 17%. In Wales sales has reduced by 3%, but prices rose by 7%. In Scotland prices have risen by 15%.
According to ReallyMoving, significantly increased the number of international transfers, mainly, of course, in the direction "from the UK” (+43%). The most popular countries for relocation are: Spain, USA, Canada, Australia, Germany and Italy.
Why do the demand for the property in the European Union by the citizens of the UK rise?
There are several reasons why European real estate is interesting for buyers from the UK, despite the uncertainty. First, housing in the EU countries for Britons is a good ratio of price and quality.
In the popular among the citizens of the United Kingdom destinations the cost of housing recovers after the crisis of 2007-2008 slower than in the UK. In addition, there is a danger that as a result of Brexit rise of square meters prices will slow down not only in the UK but in all European markets. Therefore, the property in such countries as Spain, Portugal or France will be characterized by a good ratio of price and quality.
Second, due to record low interest rates of the European Central Bank, banks in Europe offer very favorable conditions of mortgage lending, including to non-residents. Thus, in France or Spain fixed rate mortgage in the amount of 2-3% is not uncommon.
Britons owning property abroad, make a significant contribution to the development of the local economy, especially in areas with a high concentration of expats. In Spain, for example, 50% of buyers in banking real estate are citizens of the United Kingdom. In Costa Brava, Costa del Sol and other coastal regions, there are entire communities of Britons. And it is unlikely that Spain or any other country would want to give up such a respectable stream of income.
After Britain's withdrawal from the European Union the British will be treated as citizens of other countries outside the EU and the Euro zone. For example, as Americans or Australians. In the worst case, it could face additional "paper work". You may need additional documents to obtain visas or buy property.
However, many people hope for a better scenario, namely the British property buyers and expatriates in the EU will be given the same rights as EU citizens. Another positive, but unlikely scenario – the entry of the UK into the Eurozone. It will ensure British buyers of European square meters the same possibilities, which have, for example, the Swiss.
Text – Alena Eliseeva, ee24
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