House prices across the South West of England could drop if there is a no-deal Brexit , new research suggests.
Properties in the region could fall in price by as much as 5.9 per cent to an average of £240,000 if the Ƶ crashes out of the European Union without an agreement, according to the KPMG report.
Nationally, house prices could fall by considerably more - as much as 20 per cent - under no deal.
However, if prime minister Boris Johnson manages to secure a deal with Brussels then little change is likely to be seen next year, the analysis found.
If the Ƶ leaves with an agreement house price growth in the West of England is expected to be around 0.5 per cent in 2019, increasing to 0.9 per cent in 2020.
Andrew Hodgson, senior partner for KPMG in Bristol, said: “While a no-deal could dent property values in the short-term, it doesn’t detract from the fundamental factor driving the market – the lack of housing supply in the South West.
“Sales volumes are predicted to fall much more than prices - making government housing delivery targets impossible to achieve and slowing new building across the sector.
“Also, the level of leverage in the housebuilding sector is much lower - meaning that volume housebuilders will be under less pressure to materially reduce prices, which helped to create the downward spiral of prices in the global financial crisis.”
Yael Selfin, chief economist of KPMG Ƶ, added: “The housing market has been stuck in the slow lane since 2016 – with the changes to stamp duty and the uncertainties of Brexit putting the market on the back foot.
“2020 promises to be a delicate year for the housing market. Even if Brexit can be resolved relatively smoothly, the travails of the global economy will impact growth in the Ƶ, making prospects for house prices relatively subdued.”
The impact of Brexit on house prices
| Deal | No-deal | |
| London | 453,000 | 422,000 |
| South East | 327,000 | 299,000 |
| East of England | 296,000 | 269,000 |
| South West | 260,000 | 240,000 |
| West Midlands | 196,000 | 182,000 |
| East Midlands | 191,000 | 177,000 |
| North West | 167,000 | 152,000 |
| Yorkshire and the Humber | 164,000 | 150,000 |
| Wales | 164,000 | 151,000 |
| Scotland | 153,000 | 141,000 |
| Northern Ireland | 135,000 | 123,000 |
| North East | 129,000 | 116,000 |
