The Property sector and Brexit: Opportunity vs Concern
It has been over two years since the British public voted in favour of an exit from the European Union. Like many other sectors, the property sector will undoubtedly be altered through Brexit and, despite the uncertainty, there are many crucial opportunities and concerns to consider:
Despite the current uncertainty with Brexit, now is actually a good time to invest in property. A major silver lining of the process of leaving the EU has been the low interest rates, which is keeping mortgage rates low and will likely stay the same until the scheduled exit from the union of March 29th 2019. Many householders have smartly locked in their existing mortgage rates through five-year fixed-rate deals, taking advantage of the current climate.
Student housing should be see an upswing despite Brexit. Student numbers are expected to stay stable throughout the economic cycle and the number of international students should only rise following the EU withdrawal. For a student housing landlord, now is a good time to invest in property.
Brexit is causing a lot of hesitation with many current homeowners planning to extend rather than move, over fear they could lose out if they sell in the current climate. This makes for a difficult time for first time buyers eager to get onto the property ladder as there is a lot less affordable options available.
Most concerning is the future of property within the capital. The price of renting real estate in the City of London district rose 9.5 percent in the last three months of 2017, climbing to 78 pounds per square foot, from 71.21 pounds in the third quarter of 2017. Deals on property in London are taking longer to sign and are costing more money due to Brexit. Our advice? Look for lower cost regions, which are still likely to give an excellent rental return, such as Manchester and Birmingham.