I am often being asked what effect Britain leaving the UK is going to have on property prices whereupon in order to be able to provide an informed answer, it is first important to look at the various sectors of the market. I have written a piece on this particular matter in the past, however with Article 50 having now been triggered, I felt it might be helpful for me to reiterate my thoughts.

In London where multi million pound transactions to overseas buyers are common place, then in all honesty I do see buyers becoming more cautious particularly as the exchange rate will almost certainly have to be taken into consideration whereupon it is entirely possible offers made might therefore be a little lower than previously recorded. However, down on the South Coast and particularly across East and West Sussex, local properties more often than not are sold to local buyers as their money is already in the UK thus completely eliminating the requirement for the exchange rate to be brought into the equation.

As I make a point of doing so at the end of each of our auctions, I always speak personally to all of the buyers we have sold to and enquire as to what was the catalyst for their purchase whereupon at the moment the very low interest rates seem to be the most ‘common driver.’ By way of an explanation, an HMO building in Bognor Regis was recently purchased by a gentleman who had not an insignificant amount of money in his bank account but was receiving only 1.4% interest per annum whereupon his purchase had immediately increased his income to just over 10%. For him, whether Britain is within or outside of the EU was irrelevant as he has been able to achieve his goal by gaining an income he previously did not have whilst at the same time he was fully aware he was likely to benefit from capital appreciation over the next few years as his purchase was very much a long term project. The buyer also explained that due to the rate of interest he had been receiving he felt he was left with no other option than to buy a property close to where he lived and further alluded that this was the first time he had invested in property, other than the house he lives in.

The sale I have referred to I think is indicative of the market we as auctioneers benefit from down here in Sussex whereupon whilst we do have a vast cross section of buyers on our mailing list comprising of local, national and international buyers, it is as I say, the local buyers who are paying the prices our clients desire.

If you have a question about buying or selling at auction do not hesitate to contact the Parsons Son & Basley auctions team on 01273 274010.