Brexit effect on BTL?

by Readers Question

15:51 PM, 23rd February 2016
About 3 years ago

Brexit effect on BTL?

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Brexit effect on BTL?

With just a few weeks to go to the in/out referendum I’d be interested to learn of any thoughts as to the likely effect on BTL and property prices in general.Brexit

Google the subject and there are as many different opinions as articles but the one thing that does become clear is that no-one seems to be particularly sure.

Thanks.

Stephen.



Comments

Neil Patterson

15:54 PM, 23rd February 2016
About 3 years ago

Hi Stephen,

The £10 billion question.

As some will know I take a keen interest in economics, but you can count me firmly in the undecided camp still. There appears to be no clear data from anyone!

steve p

16:58 PM, 23rd February 2016
About 3 years ago

Im another on the fence although im going towards Brexit... Ive yet to see a particularly good argument of the real benefit of being in that we couldn't get if we were out... The biggest in argument seems to be we don't know what the out will look like so its safer to stay in, although I see that argument, if the EU were working for us I would agree but as it isn't im not convinced its a good reason to stay.... I think either way it will not make as big of a difference to the average joe...

As for the affects on BTL, obviously if migration drastically reduces then the demand for housing would not be at the same sustained pace (could be argued unsustainable pace), this will probably be felt most by landlords that have carved up houses into HMO's and rented to people from eastern european countries the most, I don't think it will cause a crash of any sorts but possible future rent increases and house price increases in these areas could be reduced... Saying that if wages rise because of less competition in the labour markets then it could throw fresh money into the housing market.

Simon Griffith

17:07 PM, 23rd February 2016
About 3 years ago

Nothing is certain but my gut tells me that the free market will ultimately prevail. If the City continues to perform then European banks will still use it. If BMW still produce nice cars I'll still buy them and so on. I think the 'in' camp are indulging in a lot of scaremongering. There will be a few bumps along the way but long term economically might be neutral. However, if you want immigration under control then 'out' is the only way and that must reduce the growth in demand for rental/houses and this may have a negative effect on BTL or property prices but it will be years off and there may be a rush before then. A question that needs to be asked and answered for all on this forum is whether the judicial review will be affected ? Anyone got any idea on this ? Finally, bear in mind that an 'out' vote could ultimately get rid of Osborne. Cameron's position is surely untenable if out. BoJo and Osborne would then have to go head to head and I would have thought Osborne without his protector would lose - hurray. Only one argument for voting out - a question of priorities.

Romain Garcin

19:09 PM, 23rd February 2016
About 3 years ago

It's hard to see how EU membership is not working for the UK.

It is equally unclear how leaving the EU would in itself solve any perceived issue with immigration from the EU.
Indeed, as I understand it, the free market and free movement of people come from the EEA, not the EU per se, so leaving the EU but remaining in the EEA (single market) would likely mean that freedom of movement would continue though it would perhaps allow the government to freely discriminate in relation to benefits.
This is the reason citizens from e.g. Norway can freely move to here although Norway is not an EU member.
Members of the EEA must also in effect follow most of the EU legislations.

Not to mention that about just under half of immigrants actually come from outside the EU so the government has full power to control it... But does not seem to, so I can't see how that would change.

What is sure is that the level of the debate is appallingly low as no-one has explained anything and both sides are only using spin and nonsensical one-liners.

Based on all of the above, I think that the effect of a Brexit on BTL is anyone's guess.

Monty Bodkin

23:44 PM, 23rd February 2016
About 3 years ago

Reply to the comment left by "Romain Garcin" at "23/02/2016 - 19:09":

Indeed, as I understand it, the free market and free movement of people come from the EEA, not the EU per se, so leaving the EU but remaining in the EEA....

....is far from decided, it is all subject to negotiation if the vote is to leave.

This is the reason citizens from e.g. Norway can freely move to here although Norway is not an EU member.

Swiss citizens can freely move here although Switzerland is neither an EU nor EEA member.

Members of the EEA must also in effect follow most of the EU legislations.

Norway (a member of the EEA) adopted less than 10% between 2000-2013.

What is sure is that the level of the debate is appallingly low as no-one has explained anything and both sides are only using spin and nonsensical one-liners.

Fully agree.

(Voting to stay in BTW !)

Romain Garcin

8:38 AM, 24th February 2016
About 3 years ago

Reply to the comment left by "Monty Bodkin" at "23/02/2016 - 23:44":

"….is far from decided, it is all subject to negotiation if the vote is to leave."

Well, so far those in favour of leaving the EU that I heard all say that the plan is to remain in the common market. To me this means remaining in the EEA by implication.
If it is all subject to a hypothetical re-negotiation (if people vote to leave), then Cameron has a very good point that voting to leave is a leap in the dark.

It's interesting to draw comparisons with the Scottish referendum, especially for those who claimed at the time that the SNP had no serious plan but are now claiming that they have Brexit covered 😉

Jilly G

10:28 AM, 24th February 2016
About 3 years ago

If we want to control immigration, we should simply be members of the WTO/FTA. Any European connection (EU, EEA, EFTA) means free movement of citizens.

Out of Europe should make it easier to negotiate individual trade agreements.

Brexit: short-term, economists reckon pound will lose value. Eire will probably benefit as the other English-speaking gateway to Europe.

Less immigration reduces demand on buy-to-lets so could dampen rent increases or there might be rent decreases.

Monty Bodkin

12:03 PM, 24th February 2016
About 3 years ago

Reply to the comment left by "Jilly G" at "24/02/2016 - 10:28":

It could be argued that short term, a Brexit would cause a boom in rent increases.

It will take at least a couple of years to negotiate an exit with people taking the opportunity to get into the country before the gates are shut.

Luke P

12:11 PM, 24th February 2016
About 3 years ago

My only real concern regarding Brexit on BTL is what I posted in the thread about the open letter to Grant Shapps...

When the Judicial Review -by Government appointed Judges- proves fruitless (as is feared likely), I expect we would push on to the European Courts where the best chance of success lies. Britain leaving the EU come the Summer puts that option out of the frame and we all know the expected consequences of this 'Tenant Tax'.

michael fickling

12:40 PM, 24th February 2016
About 3 years ago

Like most i dont really know what the benefits of being in the union are.BUT..consider this..the staff, of the european headquarters is huge.Then theres all the support departments buildings,quangos legislators heating lighting, double legals?? etc tec..plus we now have more of this in scotland.Ive never seen any discussion on what all this multi gtovmnt costs.I know it will be many many millions and we are all paying for it.I had a friend at one time who had been working in an admin mangmnt role in euro.HQ.She told me practically all the staff were on high wages compared to similar positions outside of that place,,,indeed quite excessively so.In any event...the one thing we do know for certain..absolutely having a euro HQ and all its very long list of departments support workers and maintenance costs runs into many many millions. Common business practice is keep it lean and certainlt dont duplicate

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