No-deal Brexit threat looms for house prices as market slides in June

The housing market is stuck in the doldrums and could be heading for a serious fall in a no-deal Brexit, warn analysts.

Halifax on Friday reported that house prices dipped 0.3% in June, though they are rising at an annual rate of 5.7%, according to the bank.

Howard Archer at the Item Club noted Halifax’s annual figure is “a complete outlier” however, with most other measures showing nothing like that performance. Nationwide has prices up by 0.5% year on year, while the Land Registry put the figure at 1.4% in April.

The June Halifax figure extends the mostly flat trend of recent months.

Russell Galley at Halifax said: “One of the major restraining factors on the volume of transactions in the market continues to be the very low level of stock for sale. With the ongoing lack of clarity around Brexit, people will be looking for more certainty in the coming months, both to encourage them to list their property and to create the confidence needed to encourage buyers.”

Archer believes house prices would quickly tumble by 5% if the UK leaves the EU without a deal. Michael Biemann, of the digital property lender Selina Finance, said: “Long term, the resilience of the UK property market is not in doubt, but in the next 12 months it will be entering the unknown and for many households caution, not confidence, will be the watchword.

“We are entering the Brexit endgame and if a no-deal exit from the EU happens, as is looking increasingly likely, transactions could slow up and prices come under more pressure in the short term.”