Your Guide To Brexit
On the 23rd June 2016, the UK went to the polls to vote whether they wanted Britain to stay or leave the European Union.
The results from the vote shocked many and with a small majority just inching ahead, Britain chose to leave.
But what does it mean for you, and your investments? Here is your property developers guide to Brexit.
What is Brexit?
Firstly on your guide to Brexit we need to clarify what exactly is Brexit?
Britain chose to exit the European Union by a public vote. ‘Brexit’ is an unwitting play on words of 'Britain' and 'exit'.
On March 29th 2017 Britain gave the European Council notice to leave.
This then triggered Article 50 of the Treaty of the European Union, now we have two years to negotiate the leaving terms with the European Union by our expected leave date of March 29th 2019.
Why are we leaving the EU?
We are leaving the European Union after the Government chose to have a ‘snap election’ in which the public were asked to vote whether they wished to leave or remain. At a 51.9% majority the public chose to leave with over 30 million voting.
Will it really go ahead?
There has been a lot of speculation among the public and campaign groups whether Brexit will actually go forward, the Government and opposition parties have however confirmed that yes, Britain will be leaving the EU.
Negotiations are still in process as we speak and the three main areas that are being discussed are;
- How much Britain owes the EU.
- What happens to the UK/ Northern Ireland border.
- What happens to the UK citizens living elsewhere, and of the EU citizens living in the UK.
These are commonly known as ‘divorce’ issues and must be completed by 29th March 2019.
The European Parliament must approve the proposed agreement with a vote of simple majority, and the European Council must approve by a vote of strong qualifying majority. As well as the UK ratifying the agreement.
What happens after 2019?
After the 29th March 2019 we will have what will be known as a ‘transition period’ until the 31st December 2020 which will allow to begin to adopt the new post Brexit rules.
What does Brexit mean for Property Investment?
We voted to leave the EU, 2 months after the 3% stamp duty tax was introduced but what does Brexit really mean for property investment?
Many experts have agreed that buy to let is still a worthy investment strategy. With predicted property prices on the increase until 2027, many millenials are becoming less likely to be able to buy their own house and instead choosing to rent.
The demand for rental properties is on the increase and as the value of the pound falls it means that investment in property is still your best asset. The ‘leave’ towns remain the best investment for landlords with the best rental yields.
Investment experts like Christian Faes has said that Brexit will ‘create opportunities for property investors’, many foreign investors are taking advantage of the exchange rate being in their favour and snapping up UK properties.
A lot of UK based investors have said that Brexit will have a positive impact on investments and the property market isn’t slowing down any time soon with many niche accommodation investments such as student housing and HMO’s and London and South/ East property prices on the increase only time will tell if is this is the case.
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