With Brexit looming over the UK and the uncertainty surrounding this, we take a look at whether the end is finally in sight, along with the consequences for the property market. Whether you are a new buy-to-let investor, or one with a flourishing portfolio, we’ll give you insider advice to help you through the UK changes and tax laws.
Brexit Latest: What Could Happen in The Next 6 Months?
- May will continue to attempt to get her deal passed in Parliament. She is still in cross-party negotiations, but the likelihood of this succeeding is remote. Once ratified then the UK can leave immediately
- New deadline is October 31st.
- If the deal fails to go through before then we take part in the European elections on May 23rd- May 26th
- If we do not hold elections then the UK crashes out without a deal on June 1st
- Possible that May resigns and the conservatives vote for a new leader. This though is an unlikely outcome as May is a very determined and stubborn leader, as has been seen over the last 2 years, and is likely to want to see the job through for the people of the UK
- A full referendum to take place on Brexit, options to be decided, likely to be a choice of 2 options, no deal or latest May deal, but even this is unsure
- Possible General election
- Cancel Brexit altogether
Obviously the above is likely to change and all have a possibility of occurring, but what is clear is that despite 2 years of negotiations and numerous votes in Parliament we are no nearer a solution, in fact, it feels that we are way off from finding an agreeable solution, and the country is now becoming very frustrated with events.
What Does This Mean For The UK?
• Is the uncertainty in our decision is showing signs of impacting on our economy?, It would seem, according to the figures, that this impact is being felt less than was previously expected. Generally, employment is at near all-time highs, the economy is growing at roughly 1.5% pa since the vote, again not sparkling but still respectable, and incomes are on the rise, despite the cost of living having risen a little more sharply as the value of GBp has led to more expensive imports. So despite all the fear-mongering, the UK is doing rather well, that’s not to say that we wouldn’t have done much better had the fog of Brexit not clouded our outlook.
• House price growth this year is the lowest it has been in almost 6 years but is still growing. Again this is not all to do with Brexit, although it has not helped. Much of the slowdown cannot be blamed solely on Brexit, much has to do with the levels that properties rose to, fueled by cheap rates and cheap money, prices were driven higher pushing affordability levels in certain parts of the country to levels that were difficult to maintain. This has naturally led to a shift lower in prices in places like London where the impact of Brexit can be felt more readily, in part to the large contingent of European workers that live in the London area.
• This has a positive impact in many cases for the UK, although a weaker pound makes imports more expensive, it has helped make our exports look cheap, has encouraged many more foreign visitors to our shores, some 39.5 million visitors to the UK in 2017 spent £24.5bn, and has led to investors from abroad snapping up property in certain parts of the country, as the drop in value makes investing in areas particularly in the North of England and the Northern Powerhouse area very attractive.
Should We Wait to Invest in Property?
Let’s remind ourselves of why we invest and the questions you should ask yourself when doing it. How do I choose the right property investment? What returns should I expect? When should I buy? Where should I buy? All of these are questions you muse over when buying and the simple answer to all of them is if it offers you what you are looking for then the timing is right. Our view is that Brexit is a huge distraction, one that people are tiring of and one that is beginning to wane.
What you have to remember is that property investment is a long term investment and the market is cyclical. You are not always able to pick the perfect moment to buy, but if you set your parameters and the property hits them then the time to buy is now. If you wait you may well get the property a little cheaper, but you also risk on missing out should a quick resolution be found and property prices jump rapidly, as pent up demand would suggest they will. The other thing to consider is that by delaying that purchase you also miss out on lost revenue and delaying may be a false economy. Ultimately though remember you are in this for the long run, and 15-20 years from now this will hopefully be a distant memory and your decision and timing will matter little.
So to conclude, we are now seeing a growing number that say they are fed up delaying their decisions and have begun to get back into the market. The Brexit Fog is still sitting heavy but is beginning to clear, and once it goes there will be a large dividend to be had for those that chose wisely and beat the crowd. There is light at the end of the tunnel, and it’s not an oncoming train, it’s the clear daylight of a post Brexit UK.
For more webinars and construction updates, make sure you’re subscribed to our YouTube channel here.