Just 10% of brokers in an online Mortgage Solutions poll of 136 respondents said they were telling clients to sit tight on making any mortgage commitments until the impact of the leave vote became clear. Some 90% of brokers said they were advising clients to keep ‘calm and carry on’.
While the market has generally continued to operate a business as usual approach since the UK voted to leave the EU, lenders and brokers are waiting with baited breath for the Bank of England’s announcement on which way interest rates will go, which could come as early as next week.
But talk of a possible drop in house prices has prompted jitters among mortgage lenders, with some firms choosing to rein in lending on higher loan-to-value products.
Paul Mahoney, managing director of buy-to-let brokerage Nova Financial, said the firm had posted a record month for transactions in June, and expects business to continue on an upward trajectory during July.
“The response we’ve received from clients who are in the process of purchasing buy-to-let properties following the Brexit vote has been far more positive than one might expect and most are of the opinion that it is business as usual,” he added.
“This may be due to most of our clients investing in the Northern Powerhouse cities like Manchester & Liverpool. It seems buyers are more concerned regarding the potential negative impact on the London market as opposed to other cities. We as property advisers agree with this attitude and view the London property market outlook as sombre whereas the main northern cities still provide very strong fundamentals”
Yulia Kozhevnikova, overseas property expert at Tranio.com, said increased interest from foreign investors in light of a weaker pound, could prevent house prices from falling.
“Britain’s pound fell against all major currencies and is forecasted to drop further. The weak sterling will be favourable for foreign property buyers, and the share of overseas investment can be expected to grow as British property will be getting cheaper for non-residents.
“Price growth will be flat in 2016-2017 throughout London, and price falls may be expected in the most expensive areas,” she added.
“We recommend investing in different property markets to minimise currency risks, for example, in Germany (euro), the US (dollar) and the UK (pound).”
