Today, Scotland makes the vote either for or against Scottish independence. This is a historical date not only for Scotland but for the whole of the UK, whereby the 307 year union between Scotland, England, Wales and Northern Ireland could potentially come to an end. The campaign has been lengthy, and filled with passion from both sides, based on speculation over the knock-on effects of independence, either good or bad, for the country. But how does this effect an online estate agents active mostly in Londonyou ask?
Well, one of the arguments strongly advocated by the ‘No’ campaign is that independence will have an adverse effect on the Scottish property market, due to uncertainty on currency, exchange rates, mortgage risk and property taxation. Demand for Scottish homes is likely to decline and Zoopla expects an average fall in property prices of some £31,000. However, while potentially negative for Scotland, the London property market is expected to enjoy a considerable boost to its already high demand, should Scotland vote ‘Yes’ today.
The result of an independent Scotland will be that certain businesses such as the Royal Bank of Scotland and Lloyds Banking Group will move their legal bases to London, resulting in the knock on effect for the property market of increased demand and therefore raised prices. With more businesses becoming based in the Capital, their employees will need homes, hence the increased demand. It is expected that as well as buyers, the market will see an increase in renters as some may prefer to take a ‘pied à terre’ approach to living in London.
Although prices in London housing have fallen almost 6% since their peak in May, from August to September of this year we have seen a 0.9% increase, potentially due to some anticipating an independent Scotland. Furthermore, the potential weakening of the UK pound will give foreign investors additional incentive to buy up in London.
These foreign investors will be looking at the higher end of the property market, boding well for sellers in areas such as Fullham, Earlsfield and Southfields - renowned for their ideal location, pleasing surroundings and spacious and comfortable properties in prime South West London. The period following the referendum result (should Scotland vote ‘Yes’) is likely to be a very interesting and profitable period for sellers in South London. With increased demand, prices are likely to rise- making it an ideal time for those who have been wanting to sell their properties to act. Among those looking to buy will be affluent Scottish employees working in large firms such as Lloyds and RBS, and also those looking to invest from overseas – therefore able to meet these raised prices.
With the votes looking acutely close, no one can quite predict what the outcome will be for the UK on Friday morning. Although certain aspects may provoke concern in the minds of the rest of the UK, one area we can look forward to changing should the separatists prevail, is the London property market. Sellers in South West London in particular should prepare themselves for a positive and profitable upcoming period. This clearly being especially true if they avoid phenomenally high estate agent feesand sell their houses online using Sell My Home instead!