Savills has claimed that there will be a significant post-Brexit housing market bounce.
But the agency says it will not take place until 2021 even if the UK leaves the EU early next year and uncertainty within the economy clears.
The prediction was made at a presentation in London yesterday at which the company, somewhat unusually, displayed a rude tweet by buying agent and media commentator Henry Pryor.
The post (see above) said ‘it takes balls the size of space hoppers to make a five-year price prediction what with Brexit, an election and a budget to follow’.
Nevertheless, Savills ploughed on, admitting that although outlook could change quickly if ‘circumstances dictate that we need to revisit our underlying assumptions’, it believes house prices will rise by 15% on average across the UK over the next five years.
Its report on the residential market suggests the housing market would be in fine fettle if it weren’t for Brexit. The constraints of Brexit and two general elections within three years will be removed once we leave the EU, Savills claims, and the housing market will see a bounce the year after.
If we leave next as expected, house prices will increase by 4.5% in 2021 and then 3% a year every year until 2024, its report claims.
“Our forecasts remain sensitive to the economic assumptions used, particularly the cost of mortgage debt,” says author Lucien Cook (left).
“If bank base rates continue to increase gradually towards 2.75% by 2027, as forecast, a period of low growth is likely to continue beyond this five-year period.”
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