As the grandstanding and campaigning draws to a close, and the vote gets ever-nearer, Brits are facing the simple question: should we remain in the EU or leave? It's a divisive subject, with people from across all sides of the political spectrum pinning their colours to either the 'Leave' or 'Remain' masts. This is certainly nothing that's troubling party whips, as unlikely allegiances form to make their case for in or out.
Of course, to the general public the real question is slightly different: What would leaving or remaining mean for me? Call it egocentric, but to most people the decision hinges on what would be most beneficial to them specifically. You can't blame them either, big businesses too are coming out in favour or against, depending on their own perceived gains or losses.
So what would Brexit mean for you? Specifically, what impact will it have on your house price, and the market awaiting you when the time comes to sell up?
Dropping prices?
Two big players in the property industry have already made their feelings abundantly clear. The National Association of Estate Agents (NAEA), and the Association of Residential Letting Agents (Arla) both predict a fall in house prices and rents if Brits vote to leave. They say that, as a result of lower immigration volumes and depressed future rises, the average British home would be worth £2,300 less by 2018. In London, the figure would be even starker – £7,500. This is largely attributed to the number of foreign nationals buying up property in the capital (which was 17 per cent of the prime property market in 2013).
Staying on the subject of immigration, the property groups forecast the UK's population to be 1 million fewer than projected by 2026 – which would seriously dent buy-to-let demand.
Though these figures could prove worrisome for homeowners, they are good news for prospective first-time buyers. An out vote, it was said, “could provide first-time buyers with breathing space as demand for housing eases off.”
Analysts have said these results could provide the Leave campaign with ammunition, with reports that Britain's population would be lowered and homes are more accessible to first-timers. However, NAEA managing director, Mark Hayward told theguardian.com: “An out vote could mean that in 10 years' time we'd find ourselves with a severe skills shortage of construction workers. So even if we then had planning permission, investment and materials to build new housing, we simply wouldn't have the resource to put the bricks and mortar together. It has the potential to have a very damaging effect on the future housing market.”
With the stats open to interpretation, it may come as little surprise that Arla and NAEA haven't come out firmly in favour of either Leave or Remain.
The rental market
The above figures may lead those living in the private rental sector to consider an 'out' vote next month. Not all is quite as it seems, though. Head of Arla, David Cox added that, whilst rental decreases could be on the horizon, it's certainly no cut-and-dried affair. Looking at the bigger picture, rents may drop slightly – but any saving would then be tempered by an exodus of buy-to-let landlords. In this case, the rental housing stock would drop, leaving more competition – which ultimately drives up prices.
He said: “The fact that rent costs would face downward pressure is both a blessing and a curse. While renters should face fair and reasonable prices, landlords need to be able to at least break even on any outgoings they have, such as a mortgage. If demand eases to such an extent that landlords cannot recuperate costs, we'll likely see a mass exit from the market, which would then just have the opposite effect on demand as supply falls – and we'd be back to square one.”
Rise-in?
With Arla and the NAEA suggesting that Brexit would lead to price drops, the opposite must certainly be the case if Britain elects to stay? Well, according to CEBR (the Centre for Economics & Business Research), this will indeed be the case. It said that – following an 'In' vote – confidence both within Britain and among wealthy foreign nationals would rocket. The end result would be an increase in house prices, taking the average from £278,000 to £303,000 by 2018. That said, CEBR wasn't quite in agreement when it came to the outcome of an 'out' vote.
The CEBR anticipated continued house price rises, even in the case of Brexit. Though it said the growth wouldn't be quite so much as for an 'in' vote, prices were still expected to increase over the coming years. In perhaps the most balanced analysis of the upcoming vote, CEBR suggested that Brexit would, in fact, have little noticeable impact during the first few years. Only after the dust had settled and measures were taken to remove Britain from the EU would the general public start to see real change.
That said, a slowing of house price growth could still have an impact on homeowner perceptions. Reporters suggest that, with house prices rising at a slower pace than expected, Brits may (perhaps paradoxically) think they are less well off.
For all the analysis, hand-wringing and figure-totting, it seems the reports and forecasts are still a known unknown. Everyone has their estimations, but the reality may be somewhat different. Either way, we're certain to find out at the end of June – and the months and years thereafter.