Why A Hard Brexit is Bad for the UK Property and Construction Sectorson
As time moves on with no agreement with the European Union, the likelihood of a hard Brexit looms even larger.
UK companies have been left with no option but to make contingency plans to protect their businesses and jobs. There is a real possibility that these contingencies plans will be activated very shortly and before the outcome is known.
The uncertainty and lack of clarity post Brexit will undoubtedly affect investment into the UK, meaning a much-reduced demand for property assets. Whether these are pure property investors or businesses choosing not to expand their UK operations, either way the demand for commercial property is likely to reduce.
Similarly, UK businesses who were considering expanding or upgrading their offices may decide to wait rather than committing to new leases.
If we leave the European Customs Union with no agreement on trade, this will affect the construction industry which will also have a direct impact on developers and property owners. Whilst many building materials are readily available in the UK, modular buildings are mainly imported from Germany and Scandinavia.
Many European nationals have already chosen to exit the UK. This could cause a slow down in house building and commercial construction due to a contraction in construction workforces, which are heavily reliant on overseas labour.
There is no doubt a hard Brexit will not be good for the UK property sector and it is imperative that the Government negotiate a good outcome for the UK economy as a whole.