Article 50 effect on first-time buyers

This article is part of
Guide to Brexit and the first-time buyer

Article 50 effect on first-time buyers

Article 50 being triggered may have less of an effect on the market for first-time buyers than the initial Brexit vote result, commentators have claimed.

Respondents to this guide believe the vote to leave the European Union (EU) was more of a blow than the eventual triggering of Article 50 will be, so the prospective pain for first-time buyers as the UK heads towards Brexit will be far less than people may fear.

According to Roland McCormack, mortgage distribution director for TSB: "It is difficult to predict the full effect that triggering Article 50 will have on first-time buyers, but we do not expect there to be a major initial response.

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"We know, for example, confidence in the mortgage market returned quickly after the shock of the EU referendum result, whereas in contrast, the market already expects the triggering of Article 50 and we have some guidance on the timing of it."

Some respondents to this guide believe heading towards Brexit may be positive for first-time buyers.

John Phillips, group operations director at Spicerhaart and Just Mortgages, says: "I think the eventual triggering of Article 50 will have a positive effect on first-time buyers as the uncertainty in the market will begin to vanish and everyone will know exactly what we are dealing with."

David Hollingworth, associate director of communications for London and Country, comments: "It is impossible to predict how it will affect the markets, economy and consumer confidence.

"Once triggered, there could be a further wave of uncertainty that dents confidence. Even then, some first-time buyers may view it more positively, if it limits competition and eases upward pressure on house prices.

"However, Article 50 should not come as a surprise and it is surprises that markets do not like. If the future direction of Brexit is clearer, there may be little to no further wobble."

Expect the unexpected

For Robert Sinclair, chief executive of the Association of Mortgage Intermediaries, it is far too early to know one way or the other what impact triggering Article 50 will have.

He says: "It is unlikely to be the firing of the starting-gun that will cause any impact on first-time buyers; more likely it will be any leaked details of the negotiations that will have an effect."

That is, of course, if Article 50 is triggered. As Donna Hopton, founder of broker forum Cherry, comments: "There is still some doubt in some quarters about whether it will in fact be triggered. 

"But even if or when it is, there seems to be no consistent view from brokers on its impact for first-time buyers, albeit clearly people will still need to house themselves regardless of whether or not we are in the European Union."


While government may be caught up in the pre-Article 50 and post-Article 50 negotiations, it is clear the government must not forget or neglect suitable housing policies that will help more people onto the housing ladder and into affordable housing.