Property Prices After Brexit - the Complete Guide

Brexit and the housing market have had an interesting relationship over the last few years.

It’s now been almost two years since the UK took the bold step to leave the EU at the start of 2021.

Since then, a great deal has happened to the Brexit property market, with huge property price fluctuations seen across the UK.

While a strong factor for these changes has undoubtedly been the economic impact of Covid-19, it’s interesting to see just how house prices have performed following the UK’s exit from the EU.

According to the latest Land Registry data, the average UK property is valued at £287,506.

This is an impressive 5.52% higher than 12 months prior and is over £37,000 more expensive than in January 2021.

Post-Brexit house prices have had a huge boom over the last year or so.

There were some large variations in prices, but growth was incredibly high from January 2021 to February 2023 (the latest available data at the time of writing).

2021 was a record-breaking year for property, with Nationwide reporting that UK house prices had increased by the highest level in 15 years, finishing the year at the highest average house price on record.

While these prices were likely not impacted by Brexit and instead were entirely influenced by a newfound appetite to move homes post-Covid, it does show that Brexit has had little impact on property market performance.

The housing market Brexit performed incredibly well in 2021, something which continue relatively consistently through to 2023, perhaps easing the anxiety of those asking, “will house prices crash after Brexit?” or “will house prices drop after Brexit?”

In fact, if you wanted to know, “will house prices go up after Brexit?” the data suggests that there is set to be an even higher level of growth over the coming years.

To get a complete picture of house prices and Brexit, it’s essential to look at the months and years following the original 2016 vote.

Every month after the initial Brexit vote, a significant drop in Brexit house prices was anticipated.

Many Remainers were fearful of the significant economic impact that could result from the UK’s withdrawal. Some were asking, “will house prices drop after Brexit?” and “will Brexit affect house prices?”

So, what actually happened in the months following the Brexit vote?

While the UK economy did slow down throughout the second half of 2016, the country’s property market didn’t immediately suffer from the so-called ‘Brexit Armageddon’ initially feared.

The GBP had one of the most significant drops that the UK economy has experienced after the Brexit vote, with the pound sinking to a 31-year low against the dollar on Wednesday, 6 July 2016.

By 24 August, however, the pound rose to £1.32 against the US dollar – the highest rate it had been at in three weeks.

While the economy certainly had its ups and downs during the next few years, this wasn’t seen in house prices after Brexit, with a continued rise in value seen across the UK market.

These promising house prices after Brexit statistics were definitely good news to those investing in UK property.

While many investors were asking, “what will happen to house prices after Brexit?”, there was also the question of rental prices to consider and how fluctuations in the rental market could impact buy-to-let investments.

With buy-to-let, rental yields are one of the key factors that investors look for in their property ventures, and many were left wondering whether their rental income would be affected by the 2016 Brexit vote.

Thankfully, this wasn’t the case, with average rental yields in the UK  heavily increasing over the last seven years.

The combination of the property market and Brexit has seen rent prices increase strongly over the past few years, particularly in the Northern UK regions.

As of April 2023, rental income has increased across the UK by around  9.9% since 2022, with the North West increasing by 9.1%, according to the HomeLet Rental Index.

While the answers to “will the housing market crash after Brexit?” and “will Brexit affect house prices?” cannot be answered with certainty, so far the statistics suggest that the market has grown fantastically over the years.

Overall, these growth levels suggest that the uncertainty brought on by Brexit may not damage the property market as much as many predicted.

Judging by how well the UK property market held up following the EU Referendum vote, it’s hopeful that property prices Brexit will remain robust over the coming years.

One of the most interesting metrics to look towards when evaluating Brexit house prices has been the level of housing transactions post-2016.

Property prices often coincide with demand, with prices likely to surge the more demand increases.

Many people were concerned that this level of demand and the ability to buy property would disappear due to Brexit, with fewer people having the money to spend on expensive purchases.

Thankfully, data released by HM Revenue and Customs suggests that Brexit has had almost no measurable impact on the volume of housing transactions in the UK.

There have been minimal changes post-2016, with a relatively consistent level of housing transactions after the referendum vote compared to before.

In fact, the only sizeable dip was seen in April 2020, where housing transactions fell from 87,860 to 37,360 since April 2019.

This level of drop was a direct consequence of lockdown measures put in place in March 2020.

Transactions quickly recovered towards the latter end of the year before reaching an incredible peak of 111,260 in April 2021.

This was a 197.8% year-on-year increase in the non-seasonally adjusted data.

Overall, aside from 2020, housing transactions have remained remarkably consistent after the June 2016 election, with no noticeable impact from Brexit.

In fact, now that the UK has officially left the EU in 2021, housing transactions have skyrocketed.

However, this is likely attributed to the desire for new property caused by the three UK lockdowns and the tax savings on offer from the stamp duty tax holiday.

There’s no denying that Brexit, and the negotiations involved, have been a long and tiresome process.

If you want to refresh your memory on what exactly happened from 2016 to 2021, here’s a complete Brexit timeline.

22 February 2016  

The Date for the EU Referendum Vote Announced  

In February 2016, David Cameron announced that the UK would vote in an EU Referendum on 23 June, officially launching the Brexit campaign.

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23 June 2016  

UK Votes to Leave the EU  

In June 2016, the UK voted to leave the EU, with the leave campaign having won by 51.9% to 48.1%. David Cameron announced his resignation as prime minister the following day.

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13 July 2016  

Theresa May Announced as Prime Minister  

Less than a month after the Brexit vote, Theresa May was appointed as the new Prime Minister, having won the Conservative Party leadership contest by default.

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29 March 2017  

May Triggered Article 50 of the Lisbon Treaty  

On 29 March 2017, Theresa May triggered Article 50 of the Lisbon Treaty, prompting Brexit with a notice period of two years.

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18 April 2017  

Theresa May Announced Plans to Hold a Snap General Election  

Theresa May called a snap general election in a bid to increase her authority in both the House of Commons and the public eye.

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8 June 2017  

General Election Saw May Lose Majority and Make a Deal With the DUP  

The final result of the 2017 general election saw no seats win a majority. As a result, Theresa May was forced to make a deal with the DUP in order to stay in power.

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15 January 2019  

May’s Withdrawal Deal Draft Rejected  

In January 2019, the UK Parliament held a vote to decide whether or not they accepted the Withdrawal Deal offered by Theresa May. This deal was rejected with just 202 votes for and 432 votes against.

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13 March 2019  

MPs Say No to a No-Deal Brexit  

Parliament voted in favour of a motion which aimed to rule out the UK leaving the EU without a deal, although the result of this vote was not legally binding.

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10 April 2019  

Deadline Pushed Back to 31 October  

Despite the aim to leave the EU on 29 March 2019, a new Brexit deadline of 31 October was announced due to the fact that Theresa May’s withdrawal agreement was rejected three times in total.

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24 May 2019  

Theresa May Resigned as PM  

On the 24 May 2019, Theresa May announced that she was standing down as Prime Minister. On 24 July, May headed to Buckingham Palace to tender her resignation to the Queen.

24 July 2019  

Boris Johnson, New PM 

Boris Johnson is appointed as the new leader of the Conservative party, now heading up the Brexit campaign.

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29 October 2019  

UK Parliament Approved General Election  

In a similar turn of events to the 2017 election, Boris Johnson called for another snap general election. Parliament approved this, and a new election campaign was launched ahead of the December election.

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12 December 2019  

Boris Wins Majority  

Boris Johnson won the 2019 general election with a comfortable majority of 365 seats. This reignited the nation’s confidence in both the UK government and Brexit as a whole, causing experts to predict that after Brexit, property prices would remain stable.

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9 January 2020  

MPs Back Withdrawal Agreement Bill  

The Commons voted 330 to 231 in favour of Boris Johnson’s Withdrawal Agreement Bill – the bill that will implement the UK’s Brexit deal.

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31 January 2020  

Departure Day  

The UK departed from the EU at 11 pm on 31 January 2020. The country has now reached the Brexit transition period before all agreements between the EU and the UK are made by the end of the year.

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2 March 2020  

Trade Talks Begin  

Trade talks officially begin in Brussels. Talks are set to continue every two weeks until a Brexit trade deal can be reached.

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19 March 2020  

Pressure to Delay Brexit  

Chief negotiator, Michel Barnier, reveals he’s caught Coronavirus. which prompts pressure to delay Brexit talks due to the ongoing Covid-19 pandemic.

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17 May 2020  

EU Urged to Show Flexibility

Michael Gove urges the EU to show ‘flexibility’ as signs continue to point towards a no-deal Brexit.

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13 June 2020  

Support for Transition Period Extension  

A survey reveals that over half of Britons support a Brexit transition period extension, while three-quarters of British people believe that the UK should work closely with the EU to combat coronavirus.

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21 August 2020  

UK Will Not Extend Trade Talks  

Negotiator Michael Barnier states that he believes a UK-EU Brexit trade deal is ‘unlikely’. The UK says it will not extend trade talks even if an agreement cannot be reached by the 31st December deadline.

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23 October 2020  

Trade Talks Continue in London  

Trade talks continue as negotiators meet in London. Liz Truss, International Trade Secretary, insists that a deal can still be done due to a new round of intensified daily meetings.

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24 December 2020  

UK and EU Agree on a Post-Brexit Trade Deal  

After months of negotiations, a deal is finally agreed upon, prior to the end of the transition period on 31 December.

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31 December 2020  

UK Leaves EU After Transition Period  

After five long years, the UK officially left the EU single market and customs union at 11 pm.

The threat of Covid-19’s impact on the UK economy and property market has somewhat overtaken Brexit uncertainty.

But just how much impact will the combination of the Coronavirus pandemic and Brexit have on the UK property market and house prices after Brexit?

While Covid-19 has undoubtedly had a big impact on the UK economy, with many people out of work and many businesses failing, the outlook for the UK property market remains positive.

With the average UK property price now at a record high, the UK property market has experienced a similar resurgence during the Coronavirus pandemic as it did back in October 2016 following the initial Brexit vote.

Hopefully, the UK property market will follow a similar pattern over the coming years as it did following Brexit uncertainty.

With predictions for huge growth in property prices in the coming years, property market predictions for 2023 and beyond look promising in the face of both the Covid-19 aftermath and the outcome of Brexit house prices.

Savills, for example, released updated property price predictions which estimate that UK property prices will grow by 6.2% by 2026.

Within the same period, an even higher growth of 11.7% is expected for the North West and the Yorkshire and the Humber regions.