Brexit vote 'may not have damaging impact on lettings sector'

Brexit vote 'may not have damaging impact on lettings sector' [Photo: Andrew Linscott via iStock]

In the last few weeks, there have been warnings that if the UK votes to leave the EU this week (June 23rd), there could be dire consequences in the property market. Even the chancellor has waded in to announce that there would be an issue with the supply of new properties and the pricing out of the market of many people who would like to own a home. 

However, according to a new survey, those working in one area of the property market do not seem all that concerned about what would happen in the event of a Brexit vote. 

The Association of Residential Letting Agents (ARLA) interviewed landlords from across the nation, and found that the majority do not believe there will be any real effect on supply, demand or rental costs, meaning that neither landlords nor tenants will be badly affected. 

As many as 65 per cent of all letting agents believe that there will not be a fall in stock levels, while only 22 per cent have predicted that there would be a drop in supply with Brexit potentially forcing landlords to exit the market. 

In terms of demand, some 31 per cent said they have concerns that there will be a drop in the number of tenants looking for homes, particularly because there will be fewer people from overseas who see the UK as a viable place to relocate to. This is compared, however, to the 55 per cent who said they think demand levels will remain consistent regardless.

And even worries about the cost of renting for tenants do not seem all that severe among those who are working in the sector, with only 19 per cent saying that they expect a Leave vote will create upward pressure on rental prices. 

"There is no avoiding the EU Referendum at the moment; and whatever the outcome, we are likely to feel the impact of the fallout of this debate in different ways," said David Cox, managing director of ARLA. 

"However, it’s important to put this into perspective and not get carried away in a zeitgeist. As outlined in our recent Brexit Report, the lettings market hosts a large number of non-UK born citizens and any change in migration policy is likely to have an impact down the line, especially in London. However, our monthly report clearly shows the sentiment amongst members is that the immediacy of this effect is likely to be minimal."