Post Brexit: mid market improvement, challenges at the top end.

August 23, 2016

What challenges does the finance industry face post-Brexit?

Post Brexit shock, the market is now settling down and looking to the future.

As the August hiatus comes to an end, we reflect on the current status of the UK property market, with the corresponding knock on effect on the bridging loan industry.

It has been an interesting year, and a turbulent few months. The collective holding of breath and sitting on hands post Brexit, now appears to be easing off, with funding lines coming back online, and deal flows starting to pick up.

It would appear the threat of economic Armageddon seems to be receding, and that initial signs show the UK economy holding up well. The reduction in interest rates to an all time low, is helping maintain confidence in the low to mid range property market.

However, there are some changes afoot in the overheated top end London market. With the amendment to the law by Chancellor Osbourne, restricting the purchase of high end property in SPV’s or other such tax efficient structures, and the changes to how stamp duty is calculated; it has led to a cooling off in the capital for larger transactions over £10m.

That said, with the collapse of Sterling meaning the cost of buying a London home for some overseas buyers is up to 20% cheaper than at the beginning of the year; there is a chance the market will flatten out, with property values losing no more than 10-15% of their peak value.

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