Brexit was a big step for Britain. It is bound to have great effects on the country. In fact, it has already begun to bring major changes. For instance, the value of the pound has decreased remarkably. This leads to the question of whether or not Brexit is really a good idea. The impact of Brexit, particularly on the economy, may be much greater than the citizens expect.
What is Brexit?
Brexit is short for British exit. This name may have been inspired by ‘Grexit’, which was used to mean ‘Greek exit’. Britain held a referendum for the UK to exit the EU, in 23rd June 2016. This issue has been there for a long time, with many political parties and advocacy groups being in support of the exit. Brexit, however, is still part of the European Union. The current Prime Minister of Britain, Theresa May, expressed her intention to make sure the UK will be ready to withdraw from the EU by March 2019.
The UK had a hard time in its attempt to be part of the European Union, which was then known as the European Economic Community. At that time, many states were struggling to be part of the EEC, which also had support from America. The UK applied for membership in 1961, but France vetoed against it in 1963. The UK tried again, but France was still adamant. In 1969, negotiations were made on whether to allow the British to join the EEC. This was later successful in 1973, when Britain, Ireland and Denmark finally became part of the great economic community.
What Inspired the Decision?
The people of the UK had two major reasons for supporting Brexit; migration and authority. These issues were considered more important to the citizens than the economic factors.
Some of the supporters of Brexit were reported to be in support of the decision because they wanted the state to have full control over the issues of immigration.Brexit would also give them better control of the state’s population. More details have been explained in UK leaving the EU. This was because there had been large numbers of other members of the EU freely migrating into the UK. This had led to a great increase in the population of foreigners by double, between 2001 and 2014.
The larger population of the Brexit supporters was reported to push for the change in order to retain The UK’s authority. The citizens said that they wanted the decisions regarding the UK to be taken solely by the UK.
There were other voters who supported Brexit for economic reasons. They opined that the UK was economically dysfunctional as members of the EU, and that breaking away would improve the state’s economy. This is because the European Union has been observed to stagnate economically; the UK citizens were afraid that their economy may stagnate as well.
Effects of Brexit on UK House Prices
Currently, there is a rising trend in the prices of houses in the UK. This is as a result of the rising demand for houses, which is outstripping the supply. UK house prices gives an up-to-date record of the current prices . Approximately 175,000 houses are required to be built every year in order to cater for the increasing demand.
Since the Brexit vote, however, the prices of houses dropped by 1%. There has been a fall in house prices thrice in one year. This is bound to happen again, since analysts have reported that there may be a fall in the prices of property; it will be bigger than any price fall experienced since the 90s.
According to the Treasury, house prices within the next two years may decrease by 18%. There is also a claim that the prices of houses may decrease by 30%, and in the most expensive areas of the UK, the prices are bound to go down by half.
The threats about decrease in house prices put house sellers in a very difficult position. They are bound to face great losses.
Besides the change in price, there has also been a change in the time taken to sell houses. This change has affected the South East and London the most. In London, the period for selling a house has risen by 5 days, while in the South East; it has risen by 4 days. The trend in house prices as from June 2016 has been recorded in decrease in house prices.
With the expected drop in the rate of immigration, the demand for houses is also expected to drop. This will leave the UK with no choice but to reduce the prices of its houses. The change will have the greatest impact on London.
Over the years, the prices of houses throughout the UK have been increasing, due to the rising demand. Business has been great for house sellers and estate agents. Brexit may be a breakthrough for the UK in terms of their authority, but it is also bound to have a great effect on its property market.
It is therefore best for anyone willing to sell their house to do so soon, before the prices drop even more. You can contact House and Homes Direct to get started on selling your property.