It’s extraordinary how all the Brexit talk has impacted so mightily on sterling and London property.
Of course property prices have been affected too. With a few precious days to go before the referendum. It appears that investment volumes have stalled somewhat in the UK commercial property market. In fact transactions do not compare favourably to Q1 last year showing a 31 percent drop. Recently The Royal Institute of Chartered Surveyors also took the temperature of their members and discovered that 80 per cent are holding back because if the uncertainties regarding the future. This has dampened investment flows and when it is added to high UK property values we may well expect a pent up demand ready to react when there is a price readjustment.
Will we experience a slump or recession or is this just scare mongering
General consensus amongst ‘remainers’ suggests that a Brexit will probably mean the Government will face real uncertainty in the wake of a vote to leave. This may mean a potential slump or temporary recession as the world gets to grips with the Uk’s new status. It has been suggested that we may lose the transparency and openness associated with being within the EU if we choose to exit. Some may well disagree with such a sweeping statement.
For rent: ‘Office space in London’
Certainly what has caught our eye is the way commentators are suggesting we may see more office space available, especially in London, if the UK leaves Europe. We do know that anyone doing big business with the EU will be hit should we leave. Interestingly it may well be the tech sector that suffers the most. London’s tech sector has attracted tremendous talent from all over the EU and it’s extraordinarily diverse. This is exactly what the tech sector needs: global diversity, variety and different perspectives. We may well find that London may not be as attractive post Brexit. There could be many reasons for that but one might be companies’ inability to offer their products and services throughout the European union from the UK capital.
London’s business has ebbed and flowed since the beginning of time.
Most of the houses in London are currently bought by Arabs, Chinese and Russians are not in the EU currently so how will that hinder. If property prices do fall then it will help first time buyers to get onto the first rung of the ladder. Although mortgages might go up they will still be able to afford more. So Is this an economic rationale or just about rebalancing a overinflated property market in the UK. Are London’s property market actually going to plummet? Doubt it. If they do drop by 15% won’t it simply eliminates the ‘hope value’ often placed on a property? Michael Gove certainly pitched in saying that leaving Europe would be an opportunity.
Well, it won’t be long until we know the result of this long-awaited referendum – whatever happens nothing will remain the same – the landscape will look very different after so much mud has been slung over the past few months.