Light and shadows in the British housing market
A Rics’ survey warns of a British housing market’s deep falling while a report from Moody’s states that it is not going to affect main investors: GCC countries.
A Royal Institution of Chartered Surveyors’ survey (Rics) foresees that home sales in the UK will significantly go down in the summer of 2016 as a consequence of Brexit, stated by the British newspaper The Guardian.
In this document, it has been noted that those provisions are the lowest since 1998 and are based on the home sales’ prices drop up to 36% in the whole country, especially in the centre of London.
The Sterling value’s slump with respect to American dollar in the last weeks would just have meant the process’ speeding up. The British housing market had shown evidence of recession yet during the current year’s first half and some experts noted that that would have been happened even without the Brexit, in a lesser way, though.
Some figures are so negative thus the value of the granted loans for house sales have increased up to 8%, until 9.4bn pounds and the number or granted loans have increased five-per-cent points, until 53.800 loans, while at the same time that is being expected that the Bank of England lowers soon the interest rates a 0.5% or even 0.25%.
In this regard, a Moody’s agency report is cooling the situation down when pointing out that those British housing market’s turmoils will not affect wealth funds that Gulf countries such as Qatar own in the UK. Gulf’s investors are the most important clients of this market in Great Britain and also Europe.
Among the causes put forward by Moody’s in its report it is being noted that the increasing oil prices during the last two years have provoked that the invested amounts by Gulf countries in this market have hugely increased; that the Gulf countries have enhanced their own expenditure budgets in order to implement big infrastructure projects and state aid, consequently they have more cash to face that market’s likely crisis, and which those countries own high currency reserves.
Although it cannot be denied that the economical effects are considerable , the business opportunities and investments will not disappear overnight in the UK.
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Del Canto Chambers’ Newsroom