Uncertainty in the final days before the official Brexit deadline has put a drag on consumer spending plans, with fewer people buying cars, booking holidays, and purchasing new homes.
New survey data released Monday from research firm IHS Markit showed consumers were less willing to spend money on big-ticket items this month as they reported feeling squeezed. Additionally, property website Rightmove noted that house price growth had stalled and home sales in February were down 7% compared to last year.
“A sharp drop in UK households’ appetite for major purchases was the main signal that Brexit uncertainty had some impact on consumer spending,” according to Tim Moore, an associate director at IHS Markit.
Consumer appetite for big purchases, including cars and holidays, was close to a five-year low, according to the IHS Markit survey. The report also showed people are feeling the largest squeeze on their financial wellbeing in just over a year.
A separate report issued on Monday from Rightmove also blamed Brexit uncertainty for weighing down the springtime housing market, when house prices and purchases are normally buoyant.
“Buying activity remains cooler than usual, with hesitation as some buyers await a more settled political climate,” said Miles Shipside, a director and market analyst at Rightmove.
House price growth in March in the UK was up just 0.4 per cent compared to February, the lowest average monthly rise at this time of year since 2011. It’s also well below the average monthly increase of 0.9 per cent that’s occurred over the past seven years.