Watford’s Property Market – One Week After The Referendum
If you’re anything like me then your facebook feed is no doubt full of Brexit news, stories, anger or petition requests to get the vote re-counted and if I’m honest I’ve tried to avoid it for the last 24 hours as there is a lot of negativity going around. Of course in my usual conversations with the lovely local people of Watford there have been a number of questions about house prices and whether I expect to see a drop and whether investors should hold off buying property at the moment.
I guess there are a couple of ways to look at this……
If you decide not to buy as a result of the referendum and property prices drop then in the short term you will have certainly won. Your money will still be in the bank earning you no interest but at least you won’t have lost anything.
If you are brave and decide to buy that investment property anyway and the market dropped 5-10% you would no doubt be a bit miffed and think it was probably a bad decision. Let’s say that property cost you £300,000 then you could be looking at a loss of £15,000-30,000.
With the above in mind I was trying to consider whether I would advise putting a hold on your next purchase ‘just in case.’
We don’t know what the effect of Brexit will be on the local market yet. We don’t know how long it might take to sort all of the issues out once Article 50 has been triggered but we do know there will always be a strong demand for rental property in Watford.
If you are worried about house prices in Watford then it might be worth considering this…..
There were 531 terraced house sold in WD18 and WD24 in 2006. The average price was just £198,187 back then. 559 flats were sold in the same area at an average price of £170,259 in 2006.
The average ‘sold’ price of a terrace in the same areas this year is £355,446 and flats have averaged out at £238,290.
This means in the last 10 years the average sold price of a terraced house has gone up 79% whereas flats have gone up 40%.
We often talk about property investment being a long term thing and if you’re in it for the long term and can weather the storms then you will probably do alright. I bought my first terraced house in Watford in 2007 before the crash and guess what……
I’ve done alright out of it! If prices drop 10% I will still have done alright out of it.
Now don’t get me wrong. I’ll be a little upset if they do drop 10% but my personal opinion is they won’t.
If over the next 10 years (which is what I would call holding a property long term) we experience anywhere near the same kind of growth a small blip will not make a huge difference.
At the moment people are being cautious and this could present itself as an opportunity for anyone looking to buy a property in Watford as fewer people will be jumping in with both feet.
I’m not suggesting you rush out to buy a property but fortune favours the brave and either way in 10 years’ time you will probably have done alright!
I’m sure there will be plenty of people that disagree with me. I’d love to hear from you whichever side of the fence you sit on so please do give me a call or send me an email and I’ll be happy to discuss this or anything else property related.