BREXIT - GREATEST OPPORTUNITY OR THREAT?

[Gareth Bain]

Earlier this month we were in the Middle East to meet new investors. One theme that kept coming up was how Brexit is impacting the property market in the UK.

Generally we find that investors are split into two camps. There are those that worry about Brexit and are reducing their exposure to UK property as a result. There are others however that see this as a huge buying opportunity. As Warren Buffett famously said, “be greedy when others are fearful and fearful when others are greedy.” Right now there is fear in the air and frankly, it presents some of the best opportunities of our lifetime.

Many property investors and developers will have noticed that over the past few years there has been a lot of money thrown into property even when it does not make rational sense. These people, with more money than sense, inflate the price of development sites for example. Now however, we are seeing sites priced much more sensibly.

To read the full article visit https://www.shojin.co.uk/blogs/brexit-greatest-opportunity-or-threat

 

[PostBrexitInvestor]

If I was an overseas investor, with a 20% Brexit premium on converting my $s to £s, I would think seriously about selective investment in the UK. I think Brexit is an opportunity in the long run as the assumption that the UK is some how being forced to give in to the EU is wrong. The UK is the EU's largest export market - EU politicians are flexing their muscles just now to prevent others following the UK but the UK has many bargain chips still to play.

 

[lookinginvest]

Long term I think we will all look back on Brexit as the moment UK property was re-based to more affordable levels for a short space of time. The UK is the largest export market for the EU - why would they cut their noses off to spite their faces?

 

[realdeals]

Bexit is an interesting one because nobody really knows how it will pan out. At the moment people are suggesting the UK will be the only loser but there could be a few opportunities in the EU when reality hits home. The UK may potentially lose access to the "Single Market" while a deal is put together but lets not forget the UK is the largest market for the EU. The UK buys more goods from the EU than it sells to the EU.

 

[PostBrexitInvestor]

Lets not forget, immigration to the UK from Europe will still be available, just under a new system. Critics of Brexit give the impression the UK is pulling up the drawbridge when this is not the case.

 

[diyhelp]

As the risks associated with Brexit become clearer so we will see more stability in UK property markets. If there is one thing markets hate more than anything it is uncertainty. Even in a worst case scenario it is easy to value assets but we are stepping into the unknown at the moment and nobody has a clue just yet - even the EU negotiators who think they are running the show.

 

[Longterminvestor]

When the variables and impact are unknown, markets tend to fear the worst and value assets on the worst case scenario. Personally I think that is what we are seeing today, fears and concerns are overdone.

I read that the EU is wanting to strip member states of more and more powers which in my mind is an affront to democracy.

 

[diyhelp]

I think we could look back on the UK's decision about Brexit and see how forward thinking and forward looking voters were. The UK refused to join the Euro and that was a mess at the start - also running 20+ separate economies as one just does not work.

 

[kchiggs]

If immigration is slowed so total population goes down then demand and thus housing costs will fall. Will it? However if £ goes down, then attraction to overseas investors goes up. I'd excpect London and maybe Birmingham to rise, but a lot of second order cities(not so known to international investors) to go down as well as smaller towns and possibly villages.

 

[lookinginvest]

I think this is the main issue with Brexit, people are led to believe that immigration numbers will fall off a cliff - this is not the case. EU applicants will simply be directed to the current UK immigration system which perfectly serves those outside of the EU looking to move to the UK. The UK population will continue to grow for the foreseeable future.

 

[kchiggs]

EU applicants will simply be directed to the current UK immigration system which perfectly serves those outside of the EU looking to move to the UK

And despite government rhetoric to the contrary, we don't have any immigration cap(like Australia,) NOR do any of the kind of intra-EU and foreign immigration controls that for example Germany does. Numbers won't fall of the cliff unless politicians act to make it so. Given May's and the conservatives track records it seems rather unlikely.(Not that other politicians are necessarily better but look at the record of who is most likely to be in power, ) NO use of the emergency brake, no cap on the total number of non-eu immigrants, no crackdown on the Americans working here remotely for US companies(they should be hiring local reps),no enforcement of the non-residents using the NHS at the taxpayer expenses(your residency should be checked before your appointment, which is a good argument for e-residency cards by the way)
or your EHIC card debited and charged against the European system,. Did your GP ask you at your last appointment to prove residency? Did the hospital?

 

[nmb]

I agree with everything you say - people voted to leave the EU because of many issues INCLUDING immigration. If the government takes back these powers and does nothing with them, what was the point of BREXIT? In all honesty the Labour Party would be a nightmare as history shows they have no intention of capping immigration (see Mandelsons email to Blair many years ago).

 

[kchiggs]

NMB, I don't think any UK main stream party are in favour of any kind of immigration control, even UKIP never had a plan to control Non-EU immigrants, (In Germany it is the Greens, who are the representatives of mainstream anti-open immigration voters which makes sense when you think about sustainability and total numbers, so they are the antidote to the far right for main stream voters opposed to immigration, and often end up in coalition. ) Probably why Germany has so much solar power too, less immigrants more solar industry jobs is a vote pleaser for certain segments. (Non EU immigrants to Germany have to earn 1.5 times the national average salary,(In Romania it is 4x) so that puts cheap labour wanting employers off. IMHO. If Remain had proposed a sensible realistic immigration control plan(like Germany or Romania's) they could easily have swung enough voters, Corbyn would have had a chance at government in the last election if labour had made more on controlling immigration) At least a party elected on immigration cap would be more possible than a have cake or eat it campaign and this mess

 

[diyhelp]

I agree with many of your points - the immigration system has not been well enough explained to the voting public. Everyone seems to think that immigration will fall off a cliff after Brexit but this is not the case. However, what a shambles the Brexit talks were yesterday - deal/no deal, complete and utter shambles. The Tory government is rocking and the knives are out for Theresa May - seems many Tory MPs are will to committ political suicide and let Labour in by default. If people think its hard making money in the property market under the Tories, wait until Corbyn gets in with property owners seen as the devil incarnate