Now that the news of Brexit has finally sunk in, you may have focused your thoughts more sharply towards how the change to the country’s status will affect you and your family. There have been all kinds of apocalyptic predictions with regard to housing prices and tax rates, and with all the buzz, it is hard to know what and how much of it is true.
It’s a good idea to do some logical thinking about what is likely to change and what isn’t. So here are some ways that Brexit might affect you, as a homeowner or buy-to-let landlord, in the coming years and months.
While some of the loudest voices have been predicting a disastrous housing crash, the rumours are not very likely to come true. Prices in the housing market have been soaring for years now, largely due to population growth and a shortage of housing stock; the mass exodus that would be needed to reverse this trend is highly unlikely.
However, prices may be seeing a bit of a dip in the next few months. Any period of economic uncertainty will make people more cautious about major purchases or life changes, so demand is likely to go down – but probably not for long.
More reasonable voices have said that prices will probably keep rising, but not at the same break-neck pace at which they have in years past. Since immigration levels could potentially fall with Brexit (though it's far from certain that they will), the shortage of housing stock may become a bit less of an issue.
Taxes, Spending, and Consumer Goods
There have also been rumours about major tax hikes and large-scale spending cuts in the areas of defence, education and health care in the aftermath of the split. In addition, fears that consumer prices will rise have been rampant. Some have claimed income taxes could go up by as much 3 per cent, and petrol and alcohol prices by as much as 5 per cent, all of which would certainly make things hard for anyone balancing a mortgage and other costs.
However, these fears are also probably exaggerated. Political leaders from across the ideological spectrum have come out against tax hikes and spending cuts in the weeks following the Brexit vote. As for petrol prices, they tend to be pretty stable, given that petrol suppliers often take measures to prevent large dips and surges in the market.
Oil prices, which underpin the cost of fuel, have also seen a major decline in recent years, and they are not likely to shoot back up anytime soon. That means that your monthly utility bill shouldn’t see too much of a change, despite the predictions.
So, don’t let the negative predictions worry you too much! There is a great deal of uncertainty about what’s going to happen in the coming months and years, but the worst of the doomsday predictions are highly unlikely to come true. We could see a bit of a rough patch for a little while, but a healthy rebound is inevitable.