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The Verdict: Brexit Results Explained

 
 
 
 
  29 Jun 2016

With Great Britain having voted to leave the European Union, it is understandable that people are looking for answers and explanations on what will happen to the country. However, with the leaders of the Leave movement seemingly unsure of what happens next or what they should do first, it can be difficult to say exactly what is going to happen in the UK in the coming months and years.

That doesn’t stop people from speculating though and of course, there has already been a major financial impact due to the Leave market. The financial market and the pound were decimated on Friday morning, with many businesses, investors and the economy seeing large sums of money wiped off their balance sheets in a short period of time. Anything which impacts on the economy is going to have a knock-on effect to the property market, and this is the basis for people making predictions with respect to the current state and future of the property market in Great Britain.

While the UK property market was affected by the pre and post period of additional stamp duty for additional property purchases in April 2016, the uncertainty of the EU referendum has already impacted on the local property market. This happened in the build-up to the 2015 General Election where the market slowed down and it happened in 2016 as well.

As for the overall impact in the market, many experts suggest that not much will change. A statement released by Brewin Dolphin outlined the fact that property prices in the UK are largely influenced by people’s incomes, which means that there may not be too much of an impact on the housing market.

Uncertainty is never good for the market

One thing that may hamper the market’s ability to get back to normal is uncertainty over how the exit from the European Union will pan out. The sooner the Conservative Leadership issue is resolved and there are clear plans for the future of the UK, the more likely it will be that the market returns to as close to normal as possible.

In the longer term, a more pertinent thing to look out for is the level of investment in UK property stock. Again though, the level of uncertainty over how the market will play out with respect to investment and business development makes it difficult, if not impossible, to fully predict how the market will pan out.

Of course, the outlook for foreign investors is very different from the situation facing domestic buyers. While one of the key reasons cited for the Leave vote was immigration, it needs to be realised that different rules and regulations will be utilised when it comes to dealing with wealthy foreign investors looking to invest in the country and the more commonly considered immigrant.

Will Brexit improve or hamper foreign investment?

The Brexit backers informed the population that voting leave wouldn’t have an impact on trade and investment into the UK because there would still be scope for trading with Europe while there would be improved opportunity to trade with countries like India and China. This means that the UK should still provide scope for foreign investors and with the pound having been weakened by the result, there should be better value for money for foreign investors looking to buy in the UK.

This means that there could be even more foreign investors buying property in the UK, which could further hamper the opportunity for UK residents to buy property. The overall market is likely to see the same level of sales but the make-up of the buyer may not be the best for the long-term development of the UK property market. There would also be a slightly ironic twist to a Brexit vote leading to more foreigners snapping up Great British homes.


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Jezzards Estate Agents



 

 

Jezzards properties Hampton

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