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Industry reacts to Britain’s decision to leave the EU

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  • 27/06/2016
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Industry reacts to Britain’s decision to leave the EU
Mortgage Solutions rounds up early reactions to Britain’s decision to leave the EU and predictions on how it will impact the housing and finance markets.
  • Governor of the Bank of England, Mark Carney: “UK banks have raised over £130bn of capital, and now have more than £600bn of high quality liquid assets. This substantial capital and huge liquidity gives banks the flexibility they need to continue to lend to UK businesses and households, even during challenging times.”
  • European Central Bank (ECB): “The European Central Bank is closely monitoring financial markets and is in close contact with other central banks. The ECB stands ready to provide additional liquidity, if needed, in euro and foreign currencies. The ECB will continue to fulfill its responsibilities to ensure price stability and financial stability in the euro area.”
  • Mayor of London, Sadiq Khan: “Londoners should know that over the coming weeks, months and years, I will work with the Government and businesses in our city to ensure London continues to be the best place in the world for business, creativity and innovation — and that London continues to be a great city in which to live, work and raise a family.”
  • Mark Weedon, head of research at Property Partner said: “In the short run, housing transactions in the mainstream market are likely to remain low, but the ‘stickiness’ of residential property may prevent house prices from actually falling, with the probable exception of London’s most expensive areas.”
  • Jonathan Sealey, chief executive of Hope Capital: “This is unchartered territory so it is very difficult to know what the full ramifications will be but we must remember that the property market has proved to be incredibly resilient in recent years. Once things start to settle down, it is likely that the market will pick up again later in the year because lenders will always need to lend and consumers will still want to move home.
  • Harpal Singh, managing director of Broker Conveyancing: “The main fear now is fear itself. If people believe the negative forecasts then we will realise their fears – that house transactions will fall through, new purchases will slow down and property prices will drop. We need to fight the fear – 15,000 mortgage advisers should tell their clients that it’s business as usual and make sure they engage with their client base to provide them with all the advice and information they need.”
  • Stephen Sklaroff, director general of the Finance and Leasing Association: “We are at the beginning of what will be a long process of discussion and negotiation. The current legal and financial regulatory framework for FLA members remains exactly as it was before the vote, and it is likely to do so for some considerable time.
  • Eddie Goldsmith, chairman of the Conveyancing Association: “People will still need to move, lenders will still need to lend and with mortgage pricing remaining highly competitive this could actually prove to be a good buyer’s market. With the ball being in the buyer’s court we may well see some hard negotiation on prices resulting in a short-term fall.”
  • Richard Garner, head of commercial at property consultancy Daniel Watney LLP: “For more risk-happy investors, the fall in the pound may prove a good buying opportunity, but the turbulence caused by the out vote will likely mean many stay away, with London’s safe haven status now in doubt.”
  • Richard Lambert, chief executive officer at the National Landlords Association (NLA): “Any knee-jerk reaction will have a real impact on our members’ mortgages, tenants’ rents and overall confidence in the market.  So we would urge the policy as regards to interest rates should be, to continue the Prime Minister’s analogy, one of steady as she goes.”
  • Richard Adams, managing director of mortgage and protection network, Stonebridge Group: “There are likely to be significant ramifications in terms of demand for purchasing property, and therefore securing a mortgage, at a time when demand has already dropped off. This will be further exacerbated depending on how the financial markets react, how lenders in turn react and in particular what might happen to rates in the future.”
  • John Phillips, group operations director at Spicer Haart and Just Mortgages: “In some ways this is a positive for the housing market as it will bring more normality back to the market. We still have a chronic shortage of houses so I don’t think that house prices will drop or that people will stop buying or selling.   What we still need is for house builders to up their level of building again, although this may stay depressed for a little while to come.”
  • Richard Pike, sales and marketing director at Phoebus Software: “The housing market in general shouldn’t be too affected immediately but it will be interesting to see what happens with the upper-level property market and whether foreigners seize the chance to buy at more advantageous exchange rates or potential buyers will be put off by the new perception of the UK as a standalone state.”
  • Guy Gittins, sales director at estate agency, Chestertons: “When currency rates stabilise and confidence returns to the property market, the clearing outlook should present a great opportunity for those bold enough to seize it, though many buyers, sellers, landlords, tenants and investors will understandably still have questions about where this result leaves residential property markets in London and the wider UK.”

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