Brexit Not a Major Concern For investors

Brexit Not a Major Concern For investors

    • 85% of property investors globally are currently investing in the UK market despite Brexit concerns 
    • Around 58% of investing high net worth individuals (HNWIs) in South Africa currently invest in property 
  • Of these82% are currently investing in UK property despite Brexit 
  • Seven in 10 cite Brexit as the catalyst for them to invest in UK property 

 Brexit will undoubtedly be one of the most debated topics to go down in UK history, however, new research has revealed that when it comes to property investment, it isn’t investors’ biggest concern as the headlines would suggest. 

A global survey of HNWIs (defined as earning more than £100,000 p/a) conducted by Censuswide on behalf of leading UK property developer SevenCapital, has found that 85% of those who invest in property are currently investing in the UK’s property market, regardless of Brexit. 

Of those surveyed in South Africa, property is the most popular investment product with 58% of those who identified as investors currently choosing property. Of these, a staggering 82% stated they are currently investing in UK property, regardless of the prospect of Brexit. 

 Interestingly, 72% cited Brexit as the catalyst for them to invest, with ‘capital growth’, ‘affordability’ and ‘stable market’ all appearing as the common key factors when considering UK property for all those surveyed. 

 Understanding the mid- to long-term view, when asked how strong they believe the UK’s property market will be in the next 18 months, four in five (80%) believe the market will be ‘good’ to ‘very strong’, with a similar figure (72%) for the UK’s market strength in three to five years’ time. 

 These are encouraging statistics for the UK property market, during a period of uncertainty and generally negative speculation over what Brexit will bring.  

 Wayne Morris, National Business Development at SevenCapital South Africa, said: These figures demonstrate that people generally recognise that there are bigger factors to consider over Brexit than when it comes to which way the UK property market is going to swing. Realistically, it’s the fear and the perception of Brexit that will have any effect, rather than the physical act of leaving the EU. 

 Ultimately, if the market were to take a dip after Brexit, seasoned investors will know that this would more likely be a catalyst for the inevitable swing back. The property market is a prime example of well-known cyclical patterns, growing through recovery and emerging stronger than previous peaks. In other words, if it takes a dip, as it did 10 years ago, it will recover and come back stronger. 

 It’s also important to understand two other key factors. Firstly, the chronic undersupply means there is an ever-growing demand for homes in the UK – whether rented or owned – and that is not something that is going to change with Brexit. 

 Secondly, property isn’t a quick purchase or investment, unless you are a ‘flipper’. If you’re looking to buy a home, the chances are you’re not going to be thinking about selling up again in less than five to 10 years’ time, and if you’re a property investor, you’re likely to be looking for long-term gains from it. Either way and dip or no dip, the price of your property, providing you did your research properly before buying, is likely to appreciate in the long run,’ he said. 

The survey was conducted amongst individuals earning more than £100,000 per year and who live in the UK (55%), Hong Kong (17%), Dubai (17%) and South Africa (11%) – all regions known for their interest in the UK property market. 

 For information on SevenCapital visit www.sevencapital.com 

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