Property law after the referendum

Caroline Taylor, partner in the commercial property team at Michelmores, considers the implications of the recent EU referendum for the property sector.

How will the referendum result affect the property sector?

At this very early stage it remains extremely difficult to predict how the separation from the EU will impact on the property sector. All we can say is that the markets have reacted predictably with uncertainty at first although they seem to be slowly recovering. Perhaps the real impact will be felt when the actual terms of our exit are fleshed out. In the real estate world, house builders’ share prices have tumbled and they are quite rightly worried about the impact that Brexit is going to have on transactional activity.

Will there be a fall in demand for new housing? Will deals be put on hold?

Certainly we have heard of quite a few deals being put on hold following Brexit and it seems a natural conclusion to draw that demand may fall but on the positive side the Council of Mortgage Lenders does not see any immediate prospect of falls in house prices due to sound market fundamentals which underpin prices and, of course, our severe housing shortage. Should there be falls, some will see such falls as a good buying opportunity and, with a weakening sterling, the overseas buyer may be tempted. Everything is very much supposition and while there may be a slowdown in property transactions it is doubtful that there will be a dramatic fall in prices.

Will there be any impact on property law in the UK?

Interestingly, from a legal perspective, real estate is relatively insulated from the