Since the UK voted to exit the EU on June 23, the rumor mill has been in full force as to what the implications could be now that Britain is no longer going to be part of the union.
The Center for Economics and Business Research (CEBR), said that a period of uncertainty over Britain's exit from the European Union (EU) will cause property prices in London to fall. However, the price drop — by 5.6 percent — was said to be pure "scaremongering."
Now the real estate adviser Colliers, have warned that Brexit may still cause a house market crash, but there was optimism in their report as they claimed that investors would see through uncertainty and the market would recover in 2017, potentially exceeding US$61 billion.
The UK #property market will be boosted in 2017 by global uncertainty according to Colliers.
— Intro Capital (@IntroCapital) 3 January 2017
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Colliers also said that the arrival of US president-elect Donald Trump, which is causing political earthquakes in the US, could enhance Britain's property prospects and make it more of a safe haven.
"The UK remains one of the most transparent and active places to do business, and currency arbitrage by international investors is opening up opportunities for new and greater investment which will no doubt help to drive the UK real estate market in 2017," said Colliers UK and Ireland chief executive Tony Horrell.
Will #Brexit be wrecking ball for #property in 2017? #realestate
— Colliers Singapore (@ColliersSGP) 2 January 2017
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However despite the boost that Trump may bring to the UK property market, Colliers have warned that challenges will likely remain throughout the year.
"Total returns in 2017 will show a very modest recovery over the 2016 collapse, but will struggle to breach two per cent," Martin Mahmuti, associate director of research and forecasting at Colliers.
"Rental growth for all property will be flat and the minus three per cent negative capital growth trend seen in 2016 will be replicated in 2017."
This forecast from Colliers comes at the same time that property experts Zoopla valued the UK property market at US$10.1 trillion.
The research claimed that if this number were converted into a GDP figure, it would be equal to the third largest economy in the world, behind China, the US and ahead of Japan and Germany. A spokesperson for Zoopla said that the market had remained resilient in 2016, despite the Brexit vote.
