As we come to the end of one of the most dramatic years in recent history, the real estate investment community is still taking stock of how the shocks and challenges of 2016 will play out in the coming years.
The economic effects of Brexit and the presidency of Donald Trump remain hard to predict, as the UK and Europe circle one another, unwilling to state their full negotiating positions. So far, the collapse in UK property values predicted by some commentators has failed to materialise.
The rise in Stamp Duty which took effect in April 2016 has dampened some demand for buy-to-let properties, although it has caused a lift in values of lower-priced homes in the Southeast of England, according to recent reports.
Demand for investment property across the UK stayed buoyant in 2016 and is expected to remain firm in 2017, as a lower sterling attracts international investors. Those in the Middle East, in particular, may benefit from not only a favourable currency exchange but from higher oil prices following the OPEC decision to cut productions levels from December 2016.
“It is encouraging to see cooperation and collaboration between the major players in the Middle East,” said Michael El Kassir, General Manager International at GRE Assets. “It’s certainly a step in the right direction and may spur additional investment demand.”
GRE Assets is celebrating a highly positive 2016, having completed its Brighton Marina development – a high profile scheme of 853 new homes in 11 seafront towers, in one of the most vibrant and sought-after districts in the UK – alongside a major project in Barcelona, the Spanish city leading the country’s emergence from recession and demonstrating a newfound confidence in real estate as an investment asset.
GRE Assets expects to make a series of new announcements in 2017 regarding further developments in the UK and Spain, based on its exceptional sales record and history of delivering outstanding projects for investors.
The next year is unlikely to prove quite so volatile as 2016 – in terms of delivering electoral shocks on the scale of Brexit and the American US election – but the fallout from these two events, together with uncertainty over the future direction of the European Union itself, as French voters head for the polls and Italy deals with political uncertainty, will doubtless present further unique challenges.
For real estate investors, finding projects with an ideal combination of high quality developers, excellent locations and infrastructure will continue to provide a hedge against dramas in the economy at large.
