During the months preceding the EU referendum, many property buyers in the UK were adding ‘Brexit clauses’ to potential deals as they negotiated their purchases. This meant that in the event of a British exit from Europe that the buyer could renege on the deal and get their deposits back. So what is happening now that the UK has indeed voted to leave the European Union?
Some ‘Brexit Clauses’ Have Indeed Been Activated
It seems some buyers are indeed activating their Brexit clause and pulling out of purchases due to the uncertainty that a Britain forced to go it alone will bring. However, a majority of purchases still seem to be going through.
The Managing Director of the luxury development firm Two Fifty One, David Humbles, told The Guardian newspaper that, “We can confirm that a few purchasers have decided not to proceed given the uncertainty of the market. However, the majority are continuing with their purchase and the marketing strategy to offer the pledge at the launch was a worthwhile exercise.”
Number of ‘Brexit Clause’ Activations is Growing
While the number of the clauses being activated to cancel sales is still relatively small, it does seem like the number has the potential to increase as more and more uncertainty over the future of Britain grows. Part of that issue is down to the immediate resignation of the Prime Minister, David Cameron, who said in his resignation speech that, “I would reassure those markets and investors that Britain’s economy is fundamentally strong and I would also reassure Britons living in European countries and European citizens living here there will be no immediate changes in your circumstances. There will be no initial change in the way our people can travel, in the way our goods can move or the way our services can be sold.”
However, it’s clear that the British people won’t get a clear picture of what exactly the future does hold until Britain officially declares its intention to leave the EU and negotiations on the manner of that exit are complete.
Scotland Sees a Boost in Market Interest
One region of the UK that might ultimately benefit from Brexit is Scotland due to their likely determination to remain part of the EU. The property website Rightmove revealed that on the morning of the Brexit result, searches for properties in Edinburgh shot up by 250% from the previous day when the result was unknown. Despite that interesting statistic, there doesn’t appear to be any great panic throughout the UK property market and it remains to be seen exactly what the future holds.