Concrete Analysis | With the pound unlikely to fall any further in the event of a no-deal Brexit, now is the time to buy UK property
- Most commentators say that the prospects for the sterling must be upwards over the medium term and that means the market is ripe for buyers
As I write this, yet again political commentators tell me, we have entered the most important week in British politics. Is this the fifth time this year? We are still no clearer on when the UK will exit the EU with parliament providing unprecedented daily drama.
This should be no surprise given the saga that Brexit has become, but it is disappointing for those who think that at last the UK has a prime minster who seems determined to take on the EU and deliver some sort of Brexit result, whether it is a deal or a no deal.
Boris Johnson has recently stated that he would “rather be dead in a ditch” than ask the EU to delay Brexit beyond October 31. In the meantime, the uncertainty around when and how Brexit will happen continues to hang over the UK commercial property market.
The market has been astoundingly resilient in the face of more than three years of political shenanigans since the EU referendum in June 2016. 2017 and 2018 were record years with over £60 billion (US$73.5 billion) of transactions; it’s only in the last six months or so that the market has declined by 25 per cent or 30 per cent in terms of activity in the UK.
That said, sitting here in London today, there seem to be tremendous advantages to be dealing in pound sterling as opposed to euro or dollar-denominated markets. Since the referendum, the pound has declined 18 per cent against the dollar and 16 per cent against the euro.
It’s hard to see the pound falling any lower though even if we have a no-deal Brexit; most commentators are saying that the prospect for the sterling must be upwards over the medium term. This would indicate that now must be a good time to buy if you are trying to take advantage of capital currency gain whilst playing in the property market.