Uncertainties in the UK Property Market around Brexit and Investment

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Shadrach   in Property & Land

12 February 2020, 10:48 GMT

There are many ambiguities around leaving the European Union, one being the real estate market for buyers.  The United Kingdom has definitely established a very stable legal process over the years, providing full security for Uk owners when purchasing their properties, an appeal for many property investors around the world, but as we plan to leave the European Union, are there divided opinions on how this robust system will be effected?

Boris Johnson’s Brexit

Before we repose on the ideas behind how Brexit may affect the property investment market, it’s important to debate the approach on how the UK’s Prime minister has intended to go away the ecu Union. Boris Johnson has left the door hospitable beginning of the EU on World Trade Organization terms, after his foreign secretary, Dominic Raab, said it had been ‘’absolutely’’ right to stay a no-deal outcome on the table in trade talks. When Johnson was asked regarding the anomaly of Brexit he replied by saying ‘’We have an excellent deal. It’s getting to allow us to return out smoothly and efficiently’’, hoping to realize the trust of the many economic investors.

Is Brexit a chance or a threat for property investors?

Although mystery prevails over the uncertain legal outcomes and economic changes of Brexit for property investors, a recent Global Survey done by the important estate department in KPMG reveals that 46% of individuals at the MIPIM (an annual international property event) said they're going to still invest on an equivalent level in UK property post-Brexit.

Although this might be the choice for a few investors, opinions aren't in need of divided. The remaining 44% of investors said that their organisation is probably going to hamper investment, leaving 10% to mention that they're looking to prevent investment completely as a results of the economic uncertainty. Many overseas investors view Brexit as a chance , thanks to the cheaper pound and fewer competition from other buyers, and believe that it'll not have any material effect on the market in places just like the global financial city of London.

The certainty that Brexit won't affect British property investors is supported by the supreme court case of Canary Wharf T1 Limited et al. v European Medicines Agency where it had been decided that Brexit won't act as a frustration for corporate companies to exhaust their leases with their landlord. Mr Justice Smith spoke and said that ‘’since the effect of frustration is to kill the contract and discharge the parties from further liability thereunder , the doctrine must not be lightly invoked and must be kept within very narrow limits’’, supporting the UK’s history of a secure system for property investors post-Brexit.

Property will still be the UK’s hottest and reliable investment asset

Since the united kingdom decided to vote to go away the EU during the referendum held in June 2016 the united kingdom housing market has already shown signs of slowing down. Whilst the values of property have remained relatively steady, there are fewer transactions happening , highlighting a slowdown within the UK housing marketplace for many investors who were once drawn to the potential long-term capital growth of property investment instead of intangible stocks and shares.

Despite this, a recent survey of 500 buy to let investors administered by MFS (Market Financial Solutions) discovered that since the EU referendum, 64% of investors haven't let Brexit impact their property investment decisions, resulting in 45% even expanding their property portfolio, only 7 of selling one or more properties as a results of the Brexit scare and 57% confident that they're going to not be changing their property investment strategy following the departure from the EU.

According to a recent article within the Guardian on the four stocks that would soar after Brexit, political stability has fed through to the currency and therefore the government is to press on with its spending plans, allowing investors to profit from secure asset investments like property. They believe property will provide a more resilient economy, warning people now's the time to take a position , a transparent sign that property will still be the UK’s hottest and reliable investment asset post-Brexit.