UNITED KINGDOM
Beyond Brexit
What’ s Happened to The English Property Market?
BY RAYMOND HAYES
South African investors observing the United Kingdom( UK) property market would most certainly have received mixed messages from what they have been seeing and hearing from the media.
In the run-up to the June 23rd referendum last year those strongly in favour of‘ Remain’ were accused of using‘ Project Fear’ to support their cause, predicting a complete crash in the property market if the country voted to leave the European Union( EU). There was a spike in the purchase of residential investment at the end of March 2016, due to significant changes to property taxes( Stamp Duty Land Tax). What inevitably followed this spike was a downturn, with the doldrums continuing right up until the referendum, after which quite a few deals went sour and the market stalled.
Those who had advocated‘ Project Fear’ felt vindicated –“ we told you so!” However, we noticed activity returning to the market in late July 2016, which remained buoyant overall ‒ in part propped up by very low interest rates encouraging more borrowing.
The UK tends to experience a lull in property movement in the January and February months, with things usually starting to rebound in the spring. This is exactly what appears to be happening.
An unexciting, predictable and slow market Modest increases in prices nationally, more realism in the highly priced central London market and the adverse effects of high property taxation( SDLT, annual charges and introduction of capital gains tax for overseas investors) working through the system
44 APRIL 2017 SA Real Estate Investor www. reimag. co. za