A recent report reveals that over half of property investors are largely undeterred by Brexit.
Following further delays to the Brexit deadline, a survey carried out by Market Financial Solutions that looked at the effect of Brexit on property investment highlights a number of interesting results.
64% of investors have not let Brexit impact their property investment plans, with a surprisingly high 45% expanding their property portfolios since the UK’s decision to leave the EU. Further findings revealed that only 7% decided to sell-up property as a result of Brexit, highlighting the limited damage the result is having on UK property investment.
After Britain leaves the UK, should we leave the EU, we may actually see a spike in property investment also. 29% of respondents are planning on actively investing in new properties once the dust has settled after the ever-lengthening Brexit deadline.
Looking back to 2016, many predicted a major fall in the UK’s property market, but this has not been the case. Despite ongoing uncertainty surrounding the current political situation, the majority of property investors have continued with their property investment plans.
Should Brexit influence your strategy?
Going forward, there is little reason as to why the UK economy will not prosper under new WTO rules that allows the continued trade with the EU with tariffs. With the ability of open up independent trade agreements, we may even see some benefits. As with property investment, it may be best to think long term.
Even those in the EU after the UK leaves will be able to migrate under the same rules that are implemented for the rest of the world (presumably). The idea then that EU citizens will avoid the UK after Brexit is, quite simply, an unjustified prediction.
Brexit actually offers many long-term benefits for property investors in the UK. Whilst there is confusion in the short term, once a formal trading agreement with the European Union has been reached, the UK is likely to survive and even prosper, this boding well for property.
Yes, there may be reduced demand for property in the short term. But, with continued net migration coupled with a growing UK population, we are highly unlikely to see a shortfall in demand going forward – quite the opposite, in fact.
Growth in the North
Cities in the North of the UK, such as Liverpool and Manchester, are seeing high growth year on year since the referendum result in 2016.
Looking at Manchester, otherwise known as the UK’s tech capital, demand for property has grown significantly. Boasting the highest regional city with office take-up space with a 54% increase on the 10-year average, job opportunities are growing at an accelerated rate due to job opportunities and improved quality of life, with many regeneration projects coming to fruition in the city.
The result of this is inward migration from across the UK and also from overseas. This cycle is allowing Manchester to grow across all sectors of the property market.
This is contrasted most evidently when compared to the South East. Properties in this area are generally bought up as property investments as opposed to properties purchased with the intention of living in them. Growth in the south East has declined year-on-year since the referendum result, highlighting the importance of developing a city and growing with current needs.
This buying behaviour and the approach Manchester has taken has performed better than the rest of the UK and also the predictions cast by many surveyors. Manchester is a real testament to bucking the trend.
Positive signs going forward
Across other sectors, there have been pretty damning effects as a result of Brexit – but not for property. The predictions for the fall in property investors and house prices have not come to fruition and the current research supports this.
The majority of property investors are actively seeking opportunities regardless of the fallout of Brexit. This confidence in the market looks set to continue going forward also, with predictions of continued investment in the capital and the North.
Although we are seeing some hesitancy with regards to the political uncertainty, the continued interest in the bricks and mortar market, given the political unrest, is a very positive sign – you just have to know where to look.
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