Assessing the effects of Brexit on UK housing economy

Abstract

This research explores the housing market in England, focusing on London. This is an important economic and social sector in society and as such it is important that housing is affordable, and that the market is stable and accessible. It is acknowledged that the property market is dependent on supply and demand, and that these factors can be affected by a multitude of issues including economic and political stability. The purpose therefore of this research is to assess the effects of Brexit on the housing market in London since 2016. The research asks three questions, namely whether Brexit led to a decline in house prices in London, the way in which this event has affected different forms of tenure and the long term impacts of the decision to leave the European Union (EU). The objectives of the study are to ascertain the factors which affect supply and demand for housing in London including domestic and non-UK investment and to consider the performance of the housing market prior to 2016. The other objectives of the study are to assess the performance in the housing market after Brexit and to determine whether the uncertainty created by Brexit has suppressed house prices from 2016 to date. Finally, the research set out to evaluate the likely impact of Brexit on house prices after the deal is completed (in a no-deal versus deal scenario). The research is based on a Positivist view of reality. Several research strategies were considered and it was determined that the optimal strategy was archival study. This option facilitates the study of past performance in the property market so that this data can be used to predict trends in future performance. This study finds that Brexit has had very little impact on housing in London. This is attributed to the fact that the market was in crisis before this event and continues in crisis to date. Brexit had an initial minor impact on investors however this impact did not last beyond 2016.