The last three years have been something of a nightmare for politicians, businesses and investment markets. The uncertainty and a lack of political willingness to push through the will of the people at one point seemed to put the whole Brexit process in danger. However, an unexpected surge in support for Boris Johnson saw him return a huge majority to Parliament allowing him to execute Brexit.
Insults and anger give way to acceptance
Since the referendum back in the summer of 2016 the insults and anger exchanged between the EU and the UK have grown to quite frankly unacceptable levels. Rumours, counter rumours, truths and lies dominated the headlines but now the UK is leaving, Brexit is happening and trade negotiations will need to start very soon.
While Boris Johnson is talking the talk and his UK government has so far walked the walk, this will not be a walk in the park when negotiating a new trade deal/relationship with the European Union. Yes, we all know that the European Union exports more to the UK than the UK buys from the EU. However, as many analysts have said over the last few days, the UK could emerge as a serious competitor to the European Union in the years ahead. Why would the EU encourage this?
Economic growth
It is ironic that with just a few days to go the OECD, an arch critic of Brexit and the UK government, confirmed that in its opinion the UK economy will outperform the EU economy in the short to medium term. This is something of a huge U-turn and has given rise to conspiracy theories and the reality of “project fear”. This was further compounded by the Bank of England’s recent decision to maintain UK base rates yet quite openly attempt to talk down the UK economy.
If you take away the support of the UK, and its huge contribution to the EU budget, this lays bare the challenges of the European Union. The Greek economy is akin to a zombie, Italy, Spain and Portugal are struggling and there are huge constitutional issues in France. If you throw in the potential for a short term recession in Germany this does not bode well for the future. There is already serious infighting within the European Union with regards to future budgets with various bodies demanding very different figures.
UK property prices
There is no greater type of paralysis than that created by uncertainty and that is what the UK property market has experienced since the summer of 2016. Initial hopes of a “quick Brexit” were quickly dashed and when Theresa May was left hopelessly exposed during Brexit negotiations there was serious concern whether the process might be reversed. Step forward Boris Johnson, promising to invest huge amounts of money into the UK property market, lift the economy and decentralise public services.
All of these issues will have a significant impact on the UK property market in the short, medium and longer term. There is no doubt that he has his critics, earned over many years of buffoonery and misdemeanours, but so far so good in his term as Prime Minister of the UK. There had been initial hopes he might have reversed some of his predecessors new property taxes regulations but in reality these are not top of his agenda at the moment.
Summary
The UK is entering a period of hope tinged with concern, potential prosperity surrounded by uncertainty but one thing is for sure, the taking back of sovereignty and control of the UK seems to be re-energising the UK business arena. There are also signs of a recovery in the UK property market with London bouncing back from recent lows and regional markets still performing well. Once the balloons have deflated, the hangovers have gone and daylight dawns a new era, there is still much work to be done. However, confidence in the UK political system has been repaired to a certain extent as the will of the people has finally been respected.