Clearly, much of what has been written post-referendum is pure conjecture and the reality is that no-one, including the most talented of economists, or gifted of speculators, actually knows what impact our exit from the EU may have. This is true of our prospects economically, politically and in the housing market where we at Morgans are entirely vested.
Our view is that the referendum was one in a long series of what might be called significant events; the list includes the dramatic stock market crashes of Black Monday in 1987, 911 and the financial crisis of 2007. Immediately following each of these events, we were told that the world had changed and that things would never be the same. A meeting of economists in December 1987 concluded that ‘’the next few years could be the most troubled since the 1930’s’’. As it happened, the economy was barely affected and went on to grow through 1988 with the stock market recovering to its pre-crash level by early 1989. Who would have believed that Iran and the USA were exchanging missile attacks in the gulf as a pre-curser to the 1987 crash?
The world financial markets have been shaken so hard over the last 25 years that it is hard to believe that they have survived, and yet they have.
Much has been said of the potential impact of Brexit on the housing market, a full two years before Brexit is actually implemented and irrespective of the fact we are yet to invoke Article 50, which will trigger the beginning of this course of events. The government is carefully picking its way through a minefield of potential scenarios and, no doubt, assembling a team of trade negotiators, suitable in quantum and skill so as to be able to competently face-off with the 6,000 plus such negotiators currently employed by the EU.
In the meantime, it has been and remains business as usual in Leeds city centre and the North Leeds rentals market. Leeds is a city in growth, economically and physically and is, we believe, very well placed to withstand the impact of external forces. Job creation is high, a wide variety of skills are within reach, our economy is diverse across sectors as disparate as manufacturing and legal and professional services and the housing market is accessible to most. Whilst the London market is unaffordable to most and due a correction, the same should not be said of Leeds. A recent search on Rightmove of all Leeds postcodes showed that there were over 120 three bedroomed properties available for sale at under £120,000.
The fundamentals haven’t changed; we have too many people chasing not enough properties and until such time as this changes significantly, for example, by a dramatic upturn in the supply of new properties, the supply and demand characteristics of the housing market are unlikely to alter.