Britain's vote to leave the European Union in the recent referendum has caused volatile financial markets and political and economical uncertainty. Leave won by 52% against 48% to remain. This will slow down the overall economy and the property market in general as the uncertainty is most likely to pull back house price growth and overall transactions over the upcoming period as buyers wait to see how the exit plays out.
Following the Brexit vote, the sterling dropped to its' lowest level against the dollar in 31 years. Lower exchange rates in combination with lower house prices may attract overseas buyers looking to acquire assets in the UK by making short-term and high end investments. The fall in sterling may therefore attract overseas buyers from Asia, Middle East and the US with fewer European investors in the upcoming months once the initial correction has occurred.
We can expect the rate of growth to slow down in the prime central London market until the financial markets can see a clearer outlook for the economy, jobs and mortgage rates.
The housing market in Dubai is continuing to experience declines in residential values for both apartments and villas. With weakening capital values and more stability in rents, the yields are becoming stronger and this may appeal to buy-to-let investors. The transaction volumes seem to be edging upwards (Cluttons, 2016).
Property value declines may be attributable to factors such as the strength of the US dollar and uncertainty regarding oil prices. The strengthening of the US dollar may hold back overseas investors as it makes it more expensive for buyers from non-USD pegged markets.
While the short to medium term outlook for the Dubai property market seems unlikely to improve too much, we remain positive on the long term outlook with the Expo 2020 which may boost the demand.
South of France
The real estate market in South of France is stable and has shown growth according to Notaires de France (2016).
Borrowing rates in France have dropped to one of the lowest in very long which may increase the demand.
The current market conditions are favourable for both the seller and the buyer and the outlook is positive.
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