Some investors raced to pull their money out of UK property after the referendum; however, it’s still too early to gauge the longer-term impact Brexit will have on the UK property market.
Panic could set in as UK property funds adjust and current uncertainties will impact on valuations, but this is not going to be like when the global financial services firm Lehman Brothers Holdings Inc. was declared bankrupt in 2008.
If the trade-weighted value of the pound stays low, rising construction costs remain a big threat but markets have a habit of finding a level and even in the overblown world of residential development it remains a fact that people need homes, and there is a huge undersupply.
The Prime Minister understands that the policy response to Britain voting to leave the EU should be swift and decisive, and if the UK is to make the most out of Brexit it has to invest to grow, and that will focus minds on the economic imperative of the Northern Powerhouse.
Domestically we have a dynamic economy and we now have control over our own destiny so let’s remain positive; and don’t forget that monetary easing will help sustain asset values, whatever the economic merits of such a policy.
The biggest risk for me remains the Eurozone, and how it responds to an economic, political and social crisis that is rapidly running out of control.
The French presidential elections are scheduled for April and May 2017 and it will be interesting to see what impact the results could have on the UK property market.
Stephen Chalcraft is a commercial property lawyer at Slater and Gordon in Manchester and Preston.
For advice on the impact, the EU referendum could have on your commercial property deal talk to the expert commercial property solicitors at Slater and Gordon on freephone 0800 916 9083 or contact us online.