We live in a bizarre world where critics of Brexit seem to have the opportunity to call a property market crash time and time again. The big noises in the world of economics suggested a crash the day after the EU referendum, slight wobble but nothing happened. As Boris Johnson approaches the 31 October there are now suggestions that UK house prices could fall by up to 20%. Note the word “could” and not “would”. I could be the next man to walk on the moon tomorrow but I won’t be. Get the idea?
Scaremongering at its worst
The UK media is full of headlines suggesting “UK to crash out of Europe”, “house prices to slump” and “house prices could nosedive after no deal Brexit”. The latest to enter the fray is KPMG, the renowned accountancy firm, suggesting nationwide house prices will decline by 6% in 2020. Apparently a drop of between “10% and 20% was not out of the question” in the event of a no deal Brexit despite the fact that the UK has serious supply issues and ever growing demand.
Many people seem to forget that the UK would immediately switch to WTO trade rules in the event of a no deal Brexit. The economy would not fall off the edge of a cliff, the UK and Europe would work under WTO tariffs until an agreement could be reached. This is by no means perfect but to suggest that all trade with Europe would cease on 1 November is not only scaremongering but it is borderline misrepresentation.
There is now talk of a shortage of medical supplies and concerns fresh produce may struggle to get to the UK. Yes, there may be issues importing oranges from Spain but what about the fresh produce the UK imports from Asia and South America? If these goods can remain fresh on such a long journey then surely there is hope for EU produce which may be a couple of days late?
Property investors biding their time
We have even seen some suggesting that the UK property market has crashed since the Brexit vote. UK house price on the whole have continued to rise since the referendum although the rate of growth has diminished somewhat. However, to suggest that UK property prices are in reverse is just wrong. London has had the froth blown off the top of what has always been a relatively frothy market. Areas in the South of England have struggled for the same reason but they are not in freefall, there is no panic selling and in London there are even signs that asking prices are being met.
How about this for a new approach to Brexit, abide by the will of the people, MPs working together rather than against each other? Maybe it was not a good idea for opposition leaders to undertake behind closed door talks with their EU counterparts as a means of blocking the U.K.’s exit from the EU? Maybe the courts could take a back step this time and let the politicians elected by UK voters do what they are supposed to do?
Voters in the UK have long memories and while those who voted remain are shouting loudest at the moment there is still a silent majority seething at the way they have been portrayed in the media. Will they have their day?