The gloomy forecast of a post-Brexit UK economy has been tempered by a minor rise in house prices, but is this a temporary glimmer of hope?
Post-Brexit Brings a Minor Rise in House Prices

The Nationwide house price index showed a 0.2 percent rise in house prices for June, the same as April and May. The reasons are thought to be continued low rates of interest on mortgages, coupled with the housing supply constriction and low unemployment figures. The rise is seen as a peak of sorts before the negative impacts of the Brexit set in - with some experts seen to predict falls of up to 7 percent in house values by next year.

Nationwide coupled its figures based on offers last month but this was before the referendum and that is expected to reduce the number of transactions and stall home-buyers.

The reduced demand from the above is further stoked by recent measures to penalise second home purchasers and the buy to let investor market with changes to the stamp duty tax. Investors may put off adding to portfolios with the 3 percent increase to stamp duty added to purchasing costs.

The Brexit could result in an increase to house prices as a temporary downward trend in prices allows first-time buyers back into the market thereby recreating demand. If the Bank of England reduces base rates in the future this could be tempered further still.


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