Despite Brexit leading to much debate and uncertainty throughout the past few years, many wealthy investors who currently own property in the UK market plan to add to their portfolios, a new study shows.
A survey of national and international high net worth individuals (earning more than £100,000 per year) conducted in the UK, Dubai, Hong Kong and South Africa, found that Brexit is not a big issue for the vast majority of wealthy investors. On the contrary, almost a quarter (23%) actually identified Brexit as the catalyst for their investment. Additional to this, Censuswide, on behalf of property developer SevenCapital, asked how strong wealthy investors believe the housing market will be in the next 18 months. Results found that 55% think that the market will be good to very strong, and approximately two thirds (64%) think this will be the case in the next three to five years’ time.
A Reuters poll has predicted that the UK’s housing market will undergo a “modest correction” if the country leaves the European Union without a deal, with the biggest fall seen in London. The survey of 25 market watchers forecast that in the event of a no-deal Brexit, prices would drop nationally by 1%, with the most exaggerated change being in London’s overvalued market, where average prices could fall by 3% in the six months after the 29 March, if the UK crashes out. All surveyed thus predicted that London would bear the brunt of a no deal Brexit fallout.
According to Nationwide’s latest house price index, house price growth “ground to a halt” in January, with prices just 0.1pc higher than the same time last year. While some areas in London and south-east England have seen considerable falls in growth since Britain voted to leave the European Union in June 2016, the opposite is true for many other regions across the North West and Midlands, where growth is particularly high.
To summarise, although one must be wary of the affect that Brexit and the various situations that may occur from future agreements (or disagreements), it is widely considered that property will continue to be a strong, stable long-term investment. This being considered, it is important to analyse where affects may be stronger or more permanent and take an objective look into the entire UK property market.