UK commercial property values increased by 2.4% over the first six months of 2016, according to the IPD All Property Index. Yet these gains were eradicated in the immediate aftermath of the EU referendum — the index fell by 2.8% in July alone.
With the EU referendum and the election of Donald Trump, 2016 has been an interesting year. Neither result was predicted by the experts or pollsters who get paid so well to know ‘what people think’. And, in both cases, the victors made campaign commitments that were outright nonsense.
The period since the UK voted to leave the European Union (EU) reminds us of the Phoney War. Although we have a new prime minister, little has changed, other than sterling’s precipitous decline.
Financial and political chaos were widely predicted if the UK voted for ‘Brexit’, yet all is calm. While we remain unconcerned about the risk of a meaningful economic contraction in the short term, there are several risks to the UK and global economies.
Recent market volatility is a stark reminder of the global economic engine’s inability to fire on all cylinders. Yet the UK consumer has enjoyed a good time of late with unemployment near 20-year lows. Wage growth has not taken off, but economists think it is just a matter of time, given there is not much slack in the labour market.
Rathbones and The Spectator last night hosted an entertaining and informative debate on the EU referendum at The London Palladium – ‘Should Britain leave the European Union?’
Myth 5: foreign investors will withdraw from the UK if it leaves the EU.