We have had a number of impossibilities turn possible during the past few years as we had an impossibility with the issue of Brexit arising, then we had another impossibility with regards to Trump in the White House followed by those two political titans May vs Corbyn battling it out for a hung parliament. Throughout this period various experts have been saying that London property is doomed because of the Brexit and all the political uncertainty. But if you look at what has really been happening prices have been falling way before Brexit was ever announced as they started to fall in 2014 after Osborne increased Stamp Duty Land Tax and that was the beginning of quite a few tax changes. Those price wars have been exacerbated to a degree by the political uncertainty and also certainly prolonged by the political uncertainty. That uncertainty will not disappear over the next two or three years, therefore does that mean London prices will decrease further?

 

 

If you look back in history there is a 400 year period where it is very clear there is a repeated cycle within the property industry with the exception of two times which are two world wars. So it takes the situation where you have total economic dislocation as the country focuses on the war effort.  The optimists always argue that the prices of property have to go up over a period of time as demand is always is far greater than supply. However for instance in 2006- 2007 demand was way higher than supply and the market still crashed this was not because we suddenly built 100s of 1000s of properties. Additionally the US had its boost within the property industry because they had an oversupply on their properties. Therefore the supply and demand argument does not have a true standing. The issue is what the press reports and the reality is often very different. Therefore please do ignore the media as the information tends to be too general with no substantiated points within the industry as they use the wrong data.

 

 

Brexit took a lot of people by surprise and held as a calamity by 42% of the population and wonderful by 58% of the population and then it transpired afterwards that a number of people did not know what they were actually voting for. The question is what are people actually going to do? It seems as though that across Europe particularly Germany is getting more interest in the London property industry even during this time. For instance a city like Frankfurt has a population of 2.5 million which is dwarfed by London. Therefore London still has a number of other points that are positive for the market which cannot be obtained in other cities. Will a number of people and businesses flee after Brexit? Is it a reality? If you see in the first half of 2017 the Chinese invested 24% more in London Real Estate than in the first half of 2016 before Brexit. German Real Estate funds are still investing billions into UK Real Estate property. Google, Amazon, Facebook even Goldman Sachs are continuing with large buildings in prime central London. Therefore even though the media is saying that Brexit is a doom and gloom for businesses and they will all flee. Is that actually what most of the businesses are doing? Yes indeed there are a handful of business who are however the large majority still see London as a central hub for investing in UK property and undertaking business.

 

 

Best of Luck!