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Yesterday, in a historic decision, British voters decided to secede from the European Union (EU). This verdict profoundly affects Britain, from restricted borders to stringent trading policies, and their leave will undoubtedly extend its reach to the rest of the world.
While Brexit’s true effect is uncertain and difficult to gauge, Americans want answers now.
Possible Consequences:
- Chris Matthews asserts on Fortune.com that the Treasury rate fall early Friday morning could mean lower mortgage rates and therefore higher home prices in the U.S.
- NAR chief economist Lawrence Yun explains that as investors lose confidence in British properties, they may look to the U.S. for real estate investment, thus stimulating the American market and elevating property prices
- Alternately, luxury agents could suffer from the inability of Brits to partake in American real estate investment
- Yun also forecasts that global economy and job creation could see stoppages, as a limited number of Brits remain capable of international real estate investment
So, what should you, as a potential homebuyer, home seller, investor, do in response to Brexit?
Firstly, continue utilizing the guiding principles you have been. Buying a home is a huge step, and one that should be taken with a great deal of consideration. Rents are high, home prices are rising, and home inventory is low; Brexit won’t have an immediate decimating effect on these American market conditions, so don’t disregard them.
In a contribution to Forbes.com, Lorraine Woellert states, “Home buying is personal. If you have the desire, money and maturity to buy a house, don’t let Brexit stop you,” and in regards to selling, “Again, the fundamentals still apply. Homes are in high demand and there are too few of them to go around. Brexit won’t change that.”
Yes, Brexit is a historic development, but it will take time to see what it means to the global economy and U.S. real estate. Even then, you will have to decide if its effects pertain significantly to you. Until then, continue buying, selling and investing intelligently. Remember, the market conditions in the U.S. remain.