Many national and international high-net-worth individuals (HNWIs) who currently invest in the UK’s property market plan to add to their property portfolios, regardless of Brexit, fresh research shows.
A survey of HNWIs, defined as earning more than £100,000 a year, conducted in the UK, Dubai, Hong Kong and South Africa, found that Brexit is not a big issue for the vast majority of buy-to-let investors, with almost a quarter - 23% - of respondents actually identifying Brexit as the catalyst for their investment.
To help understanding the likely mid- to long-term view, Censuswide on behalf of leading UK property developer SevenCapital, asked how strong they believe the UK’s property market will be in the next 18 months, and found that more than half - 55% - believe the market will be good to very strong, with that figure rising to around two in three - 64% - 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.
Andy Foote, director at SevenCapital said: “These figures demonstrate that people generally recognise that there are bigger factors to consider over Brexit when it comes to the overall trends in the UK property market. 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 5 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.”