We have entered a new political phase, one where ‘Fake News’ and ‘Alternative Facts’ are worryingly commonplace. The election of Donald Trump as the President of the United States has split opinions across the world; some see his approach as refreshing, whilst others are troubled that his views are just plain scary. In these unsettling times we need some clarity: how does Trump’s Presidency affect the London property market?
At Franklyn James we don’t deal in ‘Alternative Facts’, so here is our frank assessment of the current situation:
Trump’s principal message is abundantly clear – ‘America First’. He is seeking to boost the US economy to make it the ‘strongest economy in the world’. He has also indicated, however, that instead of putting the UK at the back of the queue for a trade deal, he is looking favourably on establishing a strong business relationship with our country. If Trump delivers on his promises with regard to growth and employment, a strong US economy will increase consumer confidence, not only in the US, but also in the UK.
For many, the installation of Trump in the Oval Office creates a sense of fear. It’s no secret that Canada’s immigration website crashed after he was elected, with huge numbers of US Nationals considering moving to what they see as a safer alternative. Jean Liggett, CEO of the UK’s Properties of the World, said in an interview in November that, “Many companies and investors may look to move their investments and companies, at least in part, out of the US to safer havens.”
The value of the pound against the dollar means that London’s property market is an attractive investment for those from across the Atlantic. The UK’s weak pound and the rise in oil prices are also the key reasons that we have seen a significant increase in clients from the Middle East. In fact, whilst London house prices have risen around 13% year on year, those wishing to purchase with US dollars will find that property in the capital is now around 10% cheaper than it was a year ago. London is now looking much more affordable, compared with many other major European cities. Furthermore, according to a report by broker CBRE Group Inc. “The election of Donald Trump has also raised the prospect that London will regain its crown as the top global destination for Middle Eastern investors. The UK capital was surpassed by New York for spending from the region in the 18 months through June 2016.” Global concerns about America’s new inward focus, as well as Trump’s immigration policies have further increased the attractiveness of investing in London.
On the ground we have seen an active market; although some people may be reluctant to move after Brexit, there is still a healthy mentality about buying and selling within the Docklands area. There is no doubt that there is a certain amount of ‘fake news’ circulating about the property market, but you need to bear in mind that what may be true for one geographical area, could be completely the opposite in another. Our clients know that whether the news is good or bad, we will always give them the honest version of what is actually happening in the London property market.
Don’t be swept up in alternative facts; for a frank assessment of the value of your property, contact our team at Franklyn James.