19th February 2016
Voting to leave Europe could hit house prices by 5%, according to online estate agent eMoov.co.uk.
Despite prime minister David Cameron’s best effort to secure a compromise with the EU over reforms, eMoov has predicted if Britain votes out then house prices will suffer.
The wealth of financial and economic implications stretch beyond the property market but for many UK residents, the impact on property prices will be a real concern as it is likely to be the most expensive asset they own.
A survey of homeowners found 55% believed leaving the EU would impact the value of their home, with 34% believe it will increase it and 21% believe it will decrease it.
Since Britain joined the EU in 2973, the average house price has increased over 2,000%. However, eMoov chief executive Russell Quirk does not believe that leaving the EU will lead to house price drops but the uncertainty among homeowners and buyers as to what will happen next.
He believes an EU exit could cause a nervous ripple effect, forcing homeowners and potential buyers to ‘baton down the hatches and weather the potential uncertain economic storm’ instead of committing to a large financial decision.
This would cool the market and prices would fall to reflect this, leading to an average £11,000 loss of value on the average UK home.
Quirk said: ‘Should the UK public vote to leave the EU, we believe it could have a detrimental knock on effect to the UK property market. We’ve been part of the EU for over 40 years now, so it’s understandable that such a momentous change will lead to uncertainty amongst the UK public, as to the resulting implications an exit will have on them.
‘This air of uncertainty will lead to inaction amongst those looking to buy and sell and the resulting dwindle in demand, will always lead to a reduction in house prices. We believe it could easily drop by 5% maybe more, so the average UK homeowner could see their property reduce by £11,000 in value.’