Does anybody have a magic potion for Brexit?
It’s soon to be the season of witches and wizards but sadly there is no magic that is going to solve the Brexit dilemma anytime soon.
From a business perspective it seems as if the whole of the UK is either on hold or in complete turmoil not knowing which way to turn or who to believe. Many of the leading figures in business have an opinion about the impact and these vary greatly depending on the day of the week and which newspaper you read. But, and it is a big but, they are still only their opinions and right now nobody really knows and won’t know until it happens.
From a property perspective there are also many unanswered questions – will the property market continue to soften, will interest rates need to go up, will there be less demand for rental property, will developers hesitate before investing or will, in fact, this create more opportunities for them?
Questions, questions, questions – all in all a cauldron of swirling ideas, opinions and projections but no firm answers.
So, what do we know?
Property prices will go up and down.
That’s part of the normal performance of the property market – this was happening long before Brexit. Nothing will change the cyclical nature of the property market in the UK whether you are an investor or a residential purchaser.
Some parts of the UK will see an increase in property prices and values, some will see a decrease.
Property prices and their values are talked about almost as often as the weather in the UK. There are obviously some areas that have been hit recently such as London – can this be laid at the feet of Brexit or is it a cyclical change that was long overdue? Correspondingly, there are some areas that are enjoying a renaissance such as Manchester, Nottingham and Birmingham.
There are always winners and losers in any market movements, but the winners aren’t always the winners and the losers aren’t always the losers so it’s about picking your time and your opportunity.
Whilst it was feared that the Brexit decision would actually mean no market growth in the property sector, it continues to be the asset class of choice with 77%* of investors saying that Brexit is unlikely to affect their long-term investment strategy. In the same survey, 63%* still regarded property as a safe and secure asset in the current market. This could explain why many purchasers and investors remain undeterred that the UK property market is an investment that delivers.
We don’t have a crystal ball but whatever happens the Cabinet seems determined to protect the UK economy by ensuring that we do not have significant interest rate rises which will in turn, protect the existing housing market and encourage developers. Couple that with a significantly robust banking system and we’re well positioned – whatever or whenever the outcome of Brexit is sorted.
Change is coming – will it be a big bang or a small whimper only time will tell.