EU REFERENDUM : RENTS MAY FALL ON BREXIT.

More scare stories.

George Osborne, a pompous man absolutely desperate to be our next Prime Minister but also one who has been shown to be a pretty poor Chancellor of the Exchequer, has been busy telling us that leaving the European Union could lead to a collapse in house prices. While this sounds worrying, all that's actually happened is that Osborne has said this, he hasn't provided any evidence for his opinion.

House prices generally rise over the years but also suffer drops at intervals, sometimes of substantial amounts as happened around 1990. House prices are affected by the availability of credit and interest rates, as well as by the general health of the economy, the strength of sterling and other factors. Osborne believes that he can analyse the overall effect of these assorted factors sufficiently well to tell us that house prices will fall by at least 10% and could fall by up to 18% in the event of a Brexit. Frankly, I'd love to have his crystal ball as I'd then win the lottery every week.

Leaving the EU may, indeed, lead to a fall in house prices, but would that be nationwide or concentrated in specific areas such as London and the South East ? How big would any fall really be ? Would it be a long-term fall or just for a few months ? Would a fall really be such bad news ?

If all prices reduce, it's actually meaningless to most homeowners as the relative values of the properties in their area remains the same; while there could be issues around negative equity for some for a time, this would reverse in due course. Overall, falling house prices have no real effect unless people are borrowing heavily against their property, which isn't a good idea anyway.

There could actually be positive effects from falling house prices in that more people may be enabled to buy a first house, while rents would also be likely to fall in line with the fall in prices. Osborne's effective assertion that a fall in house prices would be a bad thing also flies in the face of numerous Government pronouncements about the problems with the housing market; Osborne has even introduced measures to make it much more difficult for landlords to profit from renting property, action which is specifically aimed at reducing house prices. Leaving the EU could also help to lower rents as reduced demand from EU incomers could prove to be an effective brake. 

To say that our Chancellor speaks with forked tongue is unnecessary. He is doing what all the leaders of the 'Remain' camp are doing - making apocalyptic statements about the horrors that await if we dare to vote to leave this egregious organisation. His statements have little if any evidence to support them other than the output from a variety of economic models, many of which have poor track records and all of which can be countered by other economists with other models.

Staying in or coming out, both have risks. The biggest risks to our nationhood, sovereignty, security, economy and general well-being are unquestionably connected with our membership of the European Union. VOTE LEAVE !