Research by SevenCapital has revealed that more than one third of property investors who invested prior to Article 50 being triggered have not invested since.
The survey, which was commissioned through Censuswide, also found that while three in five (60%) of property investors have continued to invest since 2016, nearly one in five (17.1%) are waiting until after Brexit before they invest again.
What’s more, the majority of investors and non-investors surveyed believe that the market will make a strong recovery over the next three to five years’. Nearly two thirds (64%) said they think the market position will be good to very strong.
These statistics, coupled with reports hinting investors are waiting for the outcome of Brexit, suggest that the UK property market could be gearing up for a post-Brexit boom.
However, Andy Foote, director at SevenCapital, says that if we are set for a property boom after the UK’s exit from the EU, investors could fare better by buying now during the uncertainty. He comments: “There is much speculation on both sides about whether the market will pick up immediately after Brexit, or on the contrary whether the market will take a sharp dip in the event of a no deal.”
“Amidst the confusion it’s easy to understand why those more averse to risk would want to wait until they feel they have a better understanding of which way the market is likely to turn in the event of Brexit. However, if we are set for a property boom in the aftermath, there’s a chance that those who have waited could end up paying a higher price when they do come to invest again.”
Foote believes that waiting to invest means there will likely be less opportunity for negotiation and more competition for the best properties. In this case, investors may run the risk that the return on investment could work out less effective in the long run than if they invested sooner.
“Ultimately, we don’t know whether Brexit will even happen next month or at all, so the real question investors need to ask themselves is how much do they want to invest in property and how long are they planning to keep their investment for,” he adds.
“If the answer to the latter is 10 years plus, then whether the market does or does not dip in the near future, it will more than likely recover and deliver a good return in the long run. So then why wait to invest? Why not invest now and wait and give your property the longest possible chance to deliver the best return?”
The SevenCapital survey questioned 450 high net worth individuals (defined as earning over £100,000 per annum) from the UK, Hong Kong, UAE and South Africa.