Brexit has triggered a surge in mortgage enquiries from overseas nationals seeking to buy property in Britain.
A flood of foreign money could be about to pour into the UK’s post-Brexit housing market, if the latest mortgage report from one of the world’s largest independent financial advisory organisations is anything to go by.
Newly released data from deVere Mortgages, part of deVere Group, shows that mortgage enquiries from overseas nationals planning to acquire property in the UK has increased by a staggering 50% since the Brexit camp won last month’s EU referendum, as many foreign buyers look to take advantage of huge savings after the value of the pound plummeted against major foreign currencies following the leave vote.
This follows on from various reports from estates agents, most notably in London, claiming that they are now receiving a lot more enquiries from foreign investors looking to buy property in the UK, with one agent we spoke with stating that he had been inundated with more calls from the Middle East following the EU vote than at any other four-week period during his 20-year career.
Aside from the fall in sterling’s value, we are also seeing a price correction in property across parts of the country, which opportunistic international investors quite rightly view as an opportune moment to pile in to the UK housing market before the inevitable recovery that we here at PropertyPriceAdvice.co.uk believe will occur.
Ultimately, our view is that the UK economy, following some instability, will power ahead through trading links with many countries around the world, including continued trade with the Americas, Asia, and indeed Europe, which will have a positive impact on the UK housing market.
But in the meantime, we expect to see new housing supply coming on to the market fall in the near term as many vendors adopt a wait and see policy to what a post-Brexit UK housing market looks like, while housebuilding levels will almost certainly continue to fall as developers await greater clarity.
But despite the slump in new housing supply, high domestic demand from buyers, which we expect to see increase further after the traditional summer lull in the housing market, will be fuelled in the near term by a greater number of foreigners also looking to buy property in the UK, adding to an already acute supply-demand imbalance in the market, which is likely to continue placing upward pressure of residential property prices moving forward.