Brexit negotiations could be a blessing for foreign investors
Brexit negotiations look to be hitting a snag as David Davis and Michel Barnier trade blows. The media in Britain is, of course, unoptimistic about the current state of a deal. Indeed, the “no deal” scenario has already been laid out on the table by journalists and politicians alike.
One group which won’t be sad to see the breakdown in talks, however, is real estate investors. More than anyone, they stand to make a killing from Brexit because the deal won’t impact their business or its finances. Hey, every cloud has a silver lining, right?
Here are few reasons why investment in the UK may increase in the next two years.
Prices due to tumble
No, this isn’t the biased, fake news media trying to overturn the will of the people. The Bank of England and its governor may have come into disrepute, but Bloomberg hasn’t. And, it predicts there to be a 20 per cent fall in office prices in the capital within the next three years.
Even if the value of the property didn’t recover, it would be a savvy investment regardless. It doesn’t stop there either as property prices around the region are tipped to be affected. So, the number of companies who will buy your house for cash is bound to increase. It’s essential to remember that the UK is still a major player and a great place to own real estate.
Why is it a fantastic place to own a property? It’s because there is a housing shortage at the moment. Yes, among Theresa May’s many jobs is the need to create more affordable housing. This may not seem like it has anything to do with property investors, but read in between the lines.
As owners in a country which has low supply and high demand, they will make a killing. At the moment, the predictions are that almost 25 per cent of houses will be private lets by 2021. Even if an investor can’t find a buyer, he or she can locate a renter. Therefore, the ROI will still be astronomical.
The bubble won’t last
When property prices around the country drop, cash-rich entrepreneurs will move in quickly. The reason is a bubble. In simple terms, the market won’t stay down for long before it kicks back. Of course, when this happens, the value of real estate nationwide will rise again to normal levels.
Depending on the deal, it may even go past the current prices and hit new heights.
Therefore, an investor will have a property or properties which they bought at an affordable price with lots of positive equity. Even if the country bails out on WTO trade rules, it won’t be long before the government starts to agree on new deals. The UK is too wealthy and popular for the property industry to crash.
Finally, a vital factor to remember is that the country needs foreign investors. Therefore, corporate gains tax is due to fall, making an investment more appealing and less expensive.