Advertisement
The View | Brexit once sent London property prices sinking but may now boost them. Will this last?
- Hard Brexit or not, greater clarity on Britain’s political future is making London’s property market appealing to investors, not least those from Hong Kong
- This ‘Boris bounce’ may be temporary, but compared to Hong Kong, London remains a model of stability
Reading Time:3 minutes
Why you can trust SCMP
0
When the pound was plummeting in the months following Britain’s decision in June 2016 to vote to leave the European Union, few would have predicted that, three years later, sterling would be surging on the back of a resounding election victory for a nationalist party hell-bent on delivering a “hard Brexit”.
Yet, after a prolonged period of debilitating uncertainty over the terms of Britain’s divorce from the EU, investors are treating the thumping parliamentary majority for the ruling Conservative party – which will allow Prime Minister Boris Johnson to push his Brexit deal through parliament by the deadline of January 31 – as the catalyst for a significant reduction in political risk, long seen as one of the biggest vulnerabilities in the global economy.
However, another major source of political uncertainty shows no signs of abating. The anti-government protests in Hong Kong are dragging on, and have been given added impetus by the pro-democracy camp’s landslide victory in last month’s local elections.
While the violence and vandalism in the territory have made the Brexit saga look tame by comparison, the “Boris bounce” adds to the pull of London’s property market, long viewed as a safe haven despite the UK’s political crisis. The recent influx of Hong Kong capital, most apparent in the city’s high-end residential market, underscores the contrasting fortunes of two of the world’s leading financial centres.
To be sure, London’s real estate market has suffered as a result of Brexit-induced uncertainty.
Advertisement