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Posted on June 20th 2016 by admin-movingin

The referendum: A lot of noise, but where are the facts?

Original Author: Marc Shoffman 

How much will a Leave or Stay vote affect the housing market?

Are George Osborne’s forecasts of doom – falling house prices and hard-to-get mortgages – should there be a Leave vote wildly inaccurate or nothing but the truth?

Certainly, mortgage lending has fallen in recent weeks, but whether this has more to do with the quiet after the storm of the Stamp Duty stampede is unclear.

Have house prices stalled? Hard to tell, since the methodology behind the new official index lopped £100,000 off the average house price given by the previous ONS index in March!

So, are buyers and sellers alike really waiting to see if we are set to wake up next Friday to remain members of the European Union or will we be packing our bags to leave?

Some developers are placing Brexit clauses in contracts.

Developer Oakmayne is offering money back if there is a Brexit on its Two Fifty One Southwark Bridge Road development, due for completion in 2018. Similarly Galliard Homes has offered buyers their deposits back on a development in Slough if the UK votes to leave.

It’s not just a decision that will affect UK buyers or the British market and would affect those with holiday homes on the continent, according to EU Property Solutions, a company helping borrowers in negative equity across Europe.

Director James Bell says: “A vote to leave the EU would certainly have an enormous effect on many of the UK citizens that own property in countries like Spain, France or Italy.

“Holiday homes in these countries are incredibly popular, but without EU membership, property owners in these areas would come up against a number of problems.”

He claimed foreign mortgages would become less attainable, adding: “In France, the minimum deposit required for EU citizens to secure a mortgage is 20% but non-EU citizens face having to find deposits of up to 50% if they want to buy a holiday home or foreign property.

“Property inheritance and taxation laws would also be subject to change for Brits. The law currently treats EU and non-EU citizens differently, and this could mean British expats or foreign property owners being taxed more in the aftermath of a vote to leave.

“Being outside of the UK may also require visitors to Spain or France to apply for a visa in order to legally enter the country. Not only does this mean a more expensive and lengthy process of application and acceptance, it also means intrusive questions about income, the length of your stay, any health cover you might have, and whether you’re planning to work abroad.”

Agents that Property Industry Eye spoke to still seem undecided.

Ken Hume, of London agents James Alexander, says he is seeing hesitation and fear among buyers.

He said: “One of my colleagues in Chelsea advised me that most of his applicants were saying until the vote they won’t even look

“Our experience is less dramatic, we are still tying up deals but there is the fear of what buyers might do if we come out.”

Hume added: “I always try and be as impartial as possible on such issues but it is difficult on such an emotive issue.

“The level of migration is unsustainable at current levels and our membership clearly allows us little say over the fundamental EU policy, freedom of movement.

“I can say that I do not really know what out would mean and politicians don’t know either. Estate agents wing it sometimes but this time it’s the politicians.

“The answer I believe is that short term, we are already starting to see a slower pace as anxiety comes to the fore.

“Brexit will bring uncertainty and this may lead to a lack of both willing sellers and buyers. Us Brits are great at sitting on our hands when we are unsure.

“If we stay in, we may actually see a jump as buyers and sellers perceive it as a business as usual signal.

“In the medium to long term, the fundamentals remain the same. No supply and a constant requirement for more housing. In or out doesn’t change the fact that we are not building enough. This fact alone in my view makes housing as attractive as ever, regardless of the vote.”

Mark Rowe, managing director of Rowe Property Services, was equally undecided when we asked for his view but seemed to lean more towards an exit, adding: “I’m usually quite up with politics, but the fog screen/fear mongering that’s been created by the current government about staying in makes me think that’s a good enough reason to come out.

“I think out ultimately I suppose, but before I vote I would need to source impartial facts, both for and against.”

Chris Wood of PDQ Estates was far more unequivocal, stating: “The EU arguments on both sides are putting out a great deal of nonsense and false stats but, no one knows for sure so, best to reclaim our sovereignty, democracy and, get the hell out of the EU before it collapses in on itself as it is currently in the early stages of doing.”