'Brexit' Vote and London Developments
With the European Referendum now just a few weeks away, it is merely a natural consequence that activity on the housing market has slowed whilst nervous buyers await the all-important result on 23 June.
Many developers of new properties in London have reacted to this apprehension by holding back on proposed development plans until buyers’ confidence has (hopefully) been restored following the vote. They will be desperately hoping that this restoration does not take much time at all, but even so the financial risk is just far too high for them; with the possibility of spending millions of pounds in building costs when there can be no guaranteed return.
However, the developer of a new London skyscraper known as Two Fifty One Southwark Bridge Road, which is expected to complete in 2018 and contains 335 flats within 41 storeys, has taken the unlikely plunge to begin the development before the referendum result is announced. To counter the fear that many buyers will inevitably hold, they are offering a refund on any reservation fees paid if the buyer is not happy with the result of the referendum. The Director himself has stated: “If they (the buyers) don’t like the result, whichever way it goes, they will have the right to withdraw and their reservation fee will be refunded in full”.
Perhaps this is a gesture of confidence from the developer to suggest that they do not anticipate the referendum result having as great an impact on the housing market as others may think. However, an alternative explanation is that the developer is trying to gather as much interest in their properties as possible before the result is announced, to counter any potential deficit in sales opportunity afterwards.
In reality, the actual impact that the vote will have on the housing market is generally unknown, and there are speculated arguments for both sides of the fence; but that fact that drastic pre-emptive actions such as this are being utilised should perhaps be a warning that change is often as inappropriate as it is invigorating.