Built into the history and the culture of Britain, there is an almost instinctive rejection of the European authority over the freedom and institution of the island.
- Religious: Britain separation from Europe has its roots in the religious divide that was brought about during the reign of Henry the 8th and Elizabeth the 1st, and it is expressed in the thirty ninth article of the church of England which stated in 1571 “Bishop of Rome has no jurisdiction in this realm of England”. The nation that will not obey the decree of the pope is the same as that which today will not obey the rules and regulations of the European Union which incidentally is a roman Catholic project known as the treaty of Rome signed in 1957. This vote is about Britain spiritual identity.
- Cultural: due to the recent wave of refugees to Europe and subsequently to Britain- these refugees are willing and able to work for low wages, The Brexit advocates have outlined leaving the European Union as necessary to protect or perhaps restore the country’s identity, culture, independence and place in the world.; Once Britain used to matter and used to do things without having to consult Brussels.
- Economic: it is not easy to assess the impact of Brexit, because official data are published with a long lag. The first official estimate of GDP growth in the third quarter will not come out until late October. But it may not all be doom. Yes, we have seen the manufacturing and service sectors plummeted after the vote of July, The British pound fell to about 6% compared to several major currencies, stock market went into shock waves, some Britons struggle to find new jobs, others lost theirs, retail and restaurant sectors have seen unprecedented decline but after few weeks, things have started to normalize again.
Another sector that may feel the impact is the travel and tourism industry. Because the British pound dropped, it will make traveling to Florida far more expensive. While less British visitors will be able to come enjoy spending time in Florida like they used to.
Brexit and Us Real Estate:
My prediction is that some British might end up having to sell their investments in Florida and use the cash they get from the sale to invest in their local market or perhaps just hold on to their US investments in hopes the British Pound will bounce back. This actually could end up being a good thing for real estate agents who work with Brits.
On another note, the one place Brexit has factored into the US economy, according to Trepp’s report, is in the Federal Reserve’s decision to postpone interest rate hikes these past few months. In addition to concerns about sluggish inflation and anemic GDP growth, the Fed wanted to anticipate the market’s reaction to Brexit before proceeding with rate hikes. The fact that markets went crazy for two days and normalized actually helped the CMBS market—it made lenders feel better about lending and borrowers feel better about borrowing. Thus, my advice to all buyers on the fence is to take action while they can; find your dream home and lock in your rate.
Overall, Brexit may not have a negative effect as Britain once was a superpower outside of the EU. However, due to globalization, the decision may in the long run, cause broad global weakening, which would hurt jobs, income, and consumer confidence.
In normal conditions, The US real estate will always be attractive. If you are uncertain before purchasing or selling a home, you should go over your options with a professional that understands what is at stake. I am up to date with real estate trends, the ups and downs, when to buy, hold, or sell and most importantly, world events that may affect your decision.
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Written by Mona L. Cherkaoui
International Real Estate Advisor, Speaker, and Trainer