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News Release

Cardiff

Making sense of Brexit: What happens next after the vote to leave the EU?

JLL Cardiff comments on implications of Brexit on the Wales property market


CARDIFF, 24th June 2016 - The vote for Brexit brings considerable uncertainty to the property market in Wales. Chris Sutton, head of the Cardiff office of JLL, commented:

“Even if it is effectively ‘business as usual’ for Wales in terms of trade and legislation until 2018, such a major change will inevitably create uncertainty in the economy and real estate markets.

“This will take some time to unravel and for the implications to be worked through. Hard work is now required to build a positive narrative within the UK single market and to fully exploit those factors which are in our control such as skills, education, planning and a property strategy.  Wales has benefitted from significant EU structural funding and the likely medium term withdrawal of this will inevitably create a gap which will need to be filled.

“In the short term we may see a weakening in occupier demand. The impact on rents may be limited by tight supply, but activity will be adversely hit while initial uncertainty about direction and timing continues. In 2015, 20% of property investment activity in Wales was from overseas and this outcome is likely to mean that investor sentiment is subdued in the short to medium term. For all property markets, the initial correction may be most severe but should be followed by an upturn as opportunities re-emerge and benefits of weak sterling are recognised. Sentiment and relative pricing will be key.

“Much will depend on the speed of negotiation, the wider political picture and whether a clear direction of travel and timetable for an EU exit is established early on.”