This is a critical period for property buyers, and not just because of coronavirus. The deadline for an extension to the Brexit transition period is this June; if not, you have only this year to keep your EU rights.
There are two key factors you need to be aware of. Firstly, the Brexit talks deadline and, secondly, the volatility of the property market.
Clock ticking on Brexit negotiations
The UK is set to finish the Brexit transition period on 31st December. If, by then, we have a trade deal, then all will theoretically be as smooth as it could be. If, however, there’s no deal, we could see a return to WTO rules and significant economic disruption. So far, the chances of no-deal look high: the UK and EU have both said they’re making little progress. Many people don’t realise, however, that there’s a second clock ticking – until just the 30th June. That’s the deadline the government has to ask for an extension if talks are not progressing. So far, Boris Johnson has said no request will be forthcoming, no matter the result of the talks.
It looks, then, like we need to factor in a very real risk of a no-deal.
That could cause very significant volatility on the currency markets, with the knock-on effect of significantly changing the prices of overseas properties. Anyone who tells you that they can predict where the markets will be by that time is taking a huge risk. Just look at the last month: our quarterly forecast gathered the predictions of all the major banks, and yet none of them matched what turned out to be the reality.
That’s why we use our forecasts and our blog to explain the key point our service is founded on: don’t take your chances on sending your money through the banks on the day and hoping for the best. Instead, speak to your Personal Trader today about how we can help you protect your money. For many people, it’s a case of locking in a fixed exchange rate for up to twelve months with a forward contract.
A buyers’ market – but for how long?
I’ve spoken to a few estate agents lately as EU countries come out of lockdown.
The question of property prices in post-Covid Europe regularly comes up in my conversations with clients. So speaking to estate agents themselves I wanted to seek their view. The consensus is that we may be in a real buyers’ market very soon. While the tourist industries may not be going full pelt this summer, property buying should be easily possible, especially in places like Spain and France where we won’t even have to rely on flights (ferries and the Eurostar are still operating).
However, we don’t know how long this sense of a buyers’ market may last. Some people predict a fall in holiday lettings, leading to less demand from people looking to invest rather than to buy a home, but others make the interesting point that people may be comfortable with staying in an Airbnb-type accommodation let out by a private landlord than in a large hotel. We know that the market has only paused temporarily because of the pandemic, rather than a loss in demand, so we expect good performance long-term, but it’s difficult to predict for how long the advantages of a buyer’s market will remain.
With this uncertainty and the clock ticking on Brexit trade talks, then, if you wish to buy and maintain your existing EU rights, now is the time to consider locking in your exchange rate and making plans. Speak to your Personal Trader today on 020 7898 0541 to get started. If you haven’t already opened an account, register today, with no obligation to trade.