Brexit: An Opportunity Or A Threat?

A survey has revealed that investors are much more likely to see Brexit as an opportunity rather than a threat, in spite of factors like rising inflation.

Half of those surveyed said they considered the changing relationship between the UK and Europe to be an opportunity. Some shared the surprise and concern that dominated in the UK; in France, the feeling was largely one of incredulity that the UK was ruining the European dream. For Germany, it was seen as an opportunity to promote Frankfurt as a commercial market, while many Asian buyers and investors saw a decline in sterling as an opportunity.

In over three decades in property, UK undergoes crises and economic upheaval, but markets, particularly London, soon recovered – and often thrived.

It was on the late 1980s, when institutional investment in UK real estate came of age, when the big commercial businesses experienced some of their fastest growth and overseas investment from the likes of Japan, Sweden, and the Middle East began.

In the early 1990s, George Soros ‘broke the Bank of England’. It was also a time of chronic overbuilding and, early in the decade, sky-high interest rates – a challenge for overextended property firms. Yet by the mid-1990s, investors, particularly German firms such as Deka and Commerzbank, were piling into London property.

Finally, In 2008 and into 2009, the commercial property market was on its knees.

Whether, when and how we leave the EU may have significant, long-term implications for the economy, but the impact on commercial property is likely to be short-lived. Despite the uncertainty, the macroeconomic fundamentals remain strong. The economy is still growing, with 0.4% GDP growth in the latest quarter and employment at its highest since records began.

The property market is healthy. A no-deal Brexit could disrupt the market and affect yields, but over a period of months, not years. The market will bounce back, just as it always has done. For those with the right perspective, that’s not a disaster; it’s a buying opportunity. Learn about bridging finance and how it can benefit you by reading about Richard Butler Creagh online here. Like the official Richard Butler Creagh on Facebook to keep up to date with the latest news in property and finance market.  Show your support online by following Richard Butler Creagh on Twitter here.

 

 

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Uk House Prices Make Surprise 5.9% Rise In February

House prices rose by 5.9% in February – confounded many commentators, as it appears to contradict the widely held view that the UK’s property market remains in the grip of a slowdown.

Despite an escalation in Brexit confusion, property prices rose 3% percent last January, the latest Halifax index showed.

The Halifax said the 5.9% increase seen in February was thought to be the biggest it had ever recorded. It lifted the average property price to £236,800 – up from £223,629 at the end of January. That translates into a £470-a-day increase in value.

The big monthly rise lifted the annual rate of price growth to 2.8%, which the Halifax said was “fairly subdued” compared with 2015-16 when it was more than 8%. But with other surveys and official data mostly showing housing market, Halifax cautioned against reading too much into the strength of a single month’s figures.

Richard Butler-Creagh is the founder of Henley Finance. Learn more about how you can get the most out of a bridge financing by reading about Richard Butler Creagh online here.  Like the official page of  Richard Butler Creagh on Facebook here. Show your support online by following Richard Butler Creagh on Twitter here. Watch this video about Henly Finance and what they can offer you:

Costing the country: Britain’s finance curse

‘Finance curse’ sucks talent and investment from other industries, costing £67,500 per person over the course of two decades, say, researchers.

‘Finance curse’ sucks talent and investment from other industries, costing £67,500 per person over the course of two decades, say, researchers.

The UK has lost out on a “staggering” £4.5 trillion over the course of two decades because of an oversized financial sector, a new study has found. The “gravitational pull” of the City of London has damaged economic growth by sucking talent and investment from other productive uses such as manufacturing and research while inflating asset prices, particularly property, a paper from The Sheffield Political Economy Research Institute concluded. Between 1995 and 2015 this “finance curse” has lowered cumulative GDP by 14 percent compared to what it would have been with a leaner financial services sector, the researchers found.

Between 1995 and 2015 this “finance curse” has lowered cumulative GDP by 14 percent. They drew on previous academic studies from economists at the International Monetary Fund among others, who observed that as the level of credit to the private sector increases it generally boosts the economy as funds are allocated to people and businesses that need it.

According to the new research, the UK, which has a very large financial sector, has foregone a “staggering” £4.5 trillion of economic growth – equivalent to two and a half years of GDP or £67,500 per person.The researchers concede that the results are approximate and that further work is needed to confirm the size of this effect in the UK and its causes. Meanwhile, financial services firms reaped an estimated £400bn in excess profits.

These booming profits and salaries pushed up the relative value of the UK’s currency, making manufactured goods and agricultural products more expensive to overseas buyers. Because the price of those goods is set internationally some businesses in those sectors have become less competitive or even unviable. There are many different financing options available to real estate investors. If you are a business in need of finance, then you can consult Richard Butler Creagh at Henley Finance. Follow Richard Butler Creagh on Twitter and connect with Richard Butler Creagh on his Linkedin page here.