Thursday 28 July 2016 10:04 am

How the Brexit vote will affect house prices over the next five years

The immediate aftermath of the Brexit vote will briefly slow house price growth in the UK, nevertheless it's set to pick up thereafter.

Think tank the Centre for Economics and Business Research predicts that they'll rise 5.7 per cent over 2016, however given the average price increased eight per cent year-on-year in the first quarter, this points to a slowdown in the second half of the year.

The CEBR also downgraded its short-term expectations for house price growth to 2.2 per cent over 2017 – nevertheless the impact of the UK's shock decision to leave the European Union will gradually tail off.

House price growth should pick up in the medium-term, as exit negotiations with the EU progress and investors and households gain clarity on how post-Brexit UK will look.

Beyond 2020/21, immigration and economic policies that the UK negotiates with the EU and the rest of the world will sgnificantly affect the outlook for the housing market.