Brexit's Possible Impact on the Housing Market Overseas

It wasn't only the population of Europe sent into a tizzy over Britain's referendum: Real-estate shoppers have found themselves in unfamiliar territory as well, often wondering if they're taking full advantage of the new future of what was once one of our largest trading partners, the E.U.

What will interest rates look like?

Thankfully, home shoppers are going to find that their loans are going to get much cheaper in the short term. The treasury yield took a plunge since more people are demanding low risk government debt, and mortgage lenders are preparing for a rush of people refinancing their homes as a result.

What happens to mortgages?

Because the markets took a tumble after the referendum, consumers in the United States may find themselves newly lacking the spending power they once had. Instead of cashing their 401(K) or using stock holdings, the savvy home shopper should work to conserve their cash and buy themselves as much time as they need to wait for the financial market to get back on its feet.

Possible unseen consequences

The economy in the United States has only gotten better since its inception, and fiscal year 2016 has shown no surprises regarding this point to home shoppers across the country. However, as the wealthy overseas fail to respond confidently to the changing of the United Kingdom's economic tides, young home buyers in the United States may feel an impact.

First-time homeowners on the hunt for houses may experience a change in mortgage prices, as the wealthy overseas may very well invest in United States real estate for security. This will push mortgage rates up, and make it even more limiting to young, first-time buyers looking for a starter house. Young residents of Tampa, Florida; Washington, D.C.; Los Angeles, California; and other locales known to be attractive to foreign investors may find themselves in a housing market with a more expensive entry fee than ever before.

The best way to move forward

As big United Kingdom money floats to the shoreline of the United States, and sophisticated, foreign purchasers with money ready to go eat up coveted properties in some of the most desirable real estate locales in the country, the most any new shopper on the market for a house can do is to make sure they are as up to date as possible on any news that comes out of the United Kingdom. Brexit's uncertainty has even the most comfortable investing giants playing it safe, and people looking for real estate in the United States should make some effort to stay conscious, stay prepared, and stay alert.

Elie Hirschfeld is a NY based real estate developer.