By Staff writer
Knight Frank says Gulf buyers are delaying their real estate decisions in the UK amid the looming EU Referendum vote
A number of GCC investors are adopting a "wait and see" approach when it comes to their real estate decisions in the UK amid the looming EU Referendum vote, Knight Frank has said.
The real estate consultancy said in a statement that buyers and sellers are choosing to hold off making investment decisions until after the vote on June 23.
Sovereign and private investors from Qatar, Saudi Arabia, Kuwait and the UAE have been prolific buyers of British assets in the past decade, snapping up billions of dollars worth of property, mostly in London.
While the precise impact on Gulf investments is unclear, overall flows of foreign capital into commercial real estate in Britain stopped in the first three months of 2016, Bank of England Governor Mark Carney said in April.
And Knight Frank said GCC investors may be making a mistake in holding off on deal, claiming "there is opportunity in uncertainty".
It said the UK’s potential exit from the European Union has weakened the pound which has potential implications for the central London market, where foreign home buyers are more active. If anything, the weakening of the pound could provide a short-term boost to demand in the capital, the statement said.
The value of residential property in upmarket areas popular among Gulf investors - including Chelsea, South Kensington and Knightsbridge - fell between 3.5 and 7.5 percent on the year in May, according to Knight Frank.
"While we expect a slowdown in London’s housing market activity in the run-up to the vote, we believe there is opportunity in uncertainty based on a number of strong fundamentals," added Knight Frank.
Dana Salbak, head of research at Knight Frank MENA said: "We are seeing a number of investors adopt a wait and see approach when it comes to their real estate decisions in London… However we believe the time for action is now considering a number of favourable arguments such as a positive currency play and the availability of value in new markets as opposed to the traditional areas across London."
Victoria Garrett, head of international residential sales at Knight Frank added: "We are seeing a number of savvy investors taking advantage of the current currency play and uncertainty, to secure very good investments. This window of opportunity may be short lived depending on the outcome of the Brexit."For all the latest real estate news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.