Various polls show that momentum is growing for the campaign to leave the European Union.
Residential property prices in May recorded the steepest decline since November 2011, the latest figures show.
The house price index from estate agents Your Move and Reeds Rains reveal that home prices in the UK dropped by 0.4% in May, which is the sharpest decline for four and a half years, as uncertainty around the European Union referendum continues to have a negative impact on the housing market.
Your Move and Reeds Rains said that the average price of a home fell by £1,312 to £293,599 between April and May, as more would-be purchasers and vendors adopted a wait and see policy until after the vote.
May’s fall in property values follows on from a surge in activity earlier in the year, when buy-to-let landlords and second homebuyers rushed to acquire property ahead of the government’s new stamp duty surcharge which was introduced on 1 April.
Despite the month-on-month fall, house prices in May remained 6.8% higher compared to the same month last year, although year-on-year growth has slowed from +7.7% in April and +8% in March.
“With the Chancellor predicting that a Brexit from the EU would reduce property values by at least 10%, many buyers are holding off until after the uncertainty surrounding the referendum has been resolved,” said Adrian Gill, director of Your Move and Reeds Rains.
Pessimistic view if Britain opts to exit the EU?
Three in five Britons who believe that house prices will drop if Britain votes to exit the EU think that that their it will take at least five years for values to recover from the impact that the change will have on the UK property market and wider economy.
The YouGov survey of 1,735 UK adults at the end of May found that people were split on the potential impact of the EU referendum on house prices.
Younger generations were the most concerned, with 28% of 18 to 24 year-olds thinking it will become less affordable if the country votes to leave.
Meanwhile, 10% those aged 65-plus believe that will be the case, while 18% of people in this age bracket actually think affordability will improve.
Graham Wellesley, founder and chief executive of Wellesley Finance, said: “These figures show that people across the UK are deeply worried about how their properties will be affected if Britain votes to leave the EU later this month.”
Optimistic view if Britain opts to exit the EU?
A separate poll conducted by Reuters earlier this month showed that property values are unlikely to fall in the event of a Brexit.
Despite the recent dip in property values, house prices are still expected to end the year higher, the Reuters survey found.
But the research did reveal that the decision to remain a part of the EU or exit the 28-member bloc will impact on the level of appreciation.
If Britain stays in, property prices are expected to increase by 5% this year, the poll of 17 experts found.
Next year and the year after, prices are forecast to increase about 4% per annum.
In the event Britain votes to leave the EU, prices will almost certainly still rise, albeit at a slower rate of 3.8% this year, but stay flat in 2017 before edging higher by 2% in 2018, the Reuters poll found.
