Real Estate investors spark concerns about Brexit

As the EU referendum draws ever closer investors of global real estate have sparked concerns about how Brexit may affect property investment in the UK, writes property developer Richard Carr.

Impact

Richard Carr

Is Brexit good for property investment?

KPMG surveyed 25 real estate investors who held funds and assets in excess of $400 million about the impact that Brexit would have on property investment.

The majority felt that leaving the EU would result in a decrease of inward investment into UK property and property companies.

Over two thirds said they would slow down investment into UK property whilst Britain and the EU worked out new terms of engagement following Brexit.

As a result, the market would face some serious danger which could potentially be more damaging than the stable post-Brexit would be.

Despite this, investors were more positive about the long term health of the market with the UK out of Europe, with only a third of investors declaring that their organisation would be less likely to invest in UK property post-Brexit.

Concerns

Andy Pyle of KMPG revealed to propertywire.com some of the concerns that investors held over Brexit:

  • Economic stagnation
  • Dampening of occupier demand
  • London losing its position as Europe’s leading financial centre
  • Reduction in international workforce due to migration changes

“Since the commitment to an EU referendum, the real estate community has been noticeably reticent about investing in the UK, a fact now borne out by this research,” explained Andy.

“Arguably the more important risk is the potential social impact. If a Brexit dents the rate of house building, the housing crisis will worsen.”

Opportunity

On the flip side, some investors see Brexit as an opportunity with the possibility of dropping prices or a cheap pound allowing investors to take advantage of a less competitive process.

The major problem is trying to negate the negative effect caused by the uncertainty over the UK’s relationship with Europe. The property industry needs to be able to understand and plan for what Brexit would mean.

Richard Carr believes that although there will be a little choppy water for a small while, leaving the EU is right move.

He says that the EU is heading for a brick wall with all of the ridiculous loans that have been made to the PIGS with 1.7 trillion euros of debt collectively between them.

Soon there’s going to be an issue of mammoth proportions and we will be better off outside of it, the reason Cameron is fighting to keep us in, is that without us sharing the pain with France and Germany there is a real chance of a total Euro collapse!

We have come to the aid of Europe twice in a hundred years they never were very thankful, in fact we have come off worse for it, we have Victorian infrastructure, roads that are a joke compared to the rest of Europe and trains that are laughable compared to France and Germany.

We only finished paying the USA and Canada for the Second World War in 2006 why did Germany and France not pay? Richard believes that the UK is we better off out as we will become the safe haven of the world without the EU around our neck.