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David Adams, the Managing Director of Luxury Estate Agency John Taylor in central London says that the vote in favour of a Brexit on Friday was a shock. However, the reaction from clients has been equally surprising. “I was innundated with more calls from the Middle East on Friday than on any other day in my career”. “Many Middle Eastern clients from Jordan, Saudi, Kuwait and Dubai have offered unprompted congratulations on the outcome, which, with all the doom and gloom here, I did not expect”. The prevailing view is that England, after some instability, will power ahead through trading links with the former Commonwealth countries and the Middle East as well as with continued trade with the Americas and Asia. Many investors are interested in doing business within what they see as a currency window, before the inevitible recovery occurs. Global exporters see the potential of the UK as a large and more attractive market once EU trade tariffs have been removed. “I have also had concerned calls from Monaco, France and Switzerland, but their concern is more for what will now happen in Europe and whether more referendums will be held. Interestingly they all think England will, after a short period of instability, do well” David adds.

The enquiries and the offers made on properties in London on Friday and over the weekend were greater in value than all of the sales made in the year to date through the London office. The currency which fell over 10% against US backed currencies appeared a major incentive as the speed of transaction became more important than the price.

In terms of what happens next: by law nothing fundamental will change over the next 28 months. The process of a Brexit is unlikely to start until Q4 2016 and the earliest that The UK is likely to leave the EU is October 2018. Relations with Europe will continue following an exit from the E.U, albeit on revised terms, and the UK has over two years to put in place new trade agreements with the rest of the world including all of the former Commonwealth countries, which were major trading partners until the 1970s. The Canadians have already begun making free trade agreement overtures.

For property the out-look remains uncertain but not in the way being portrayed in the press, where staunch Remainers are now forecasting emotionally charged doom and gloom, having lost the vote.

Prior to the referendum the property market was headed into a minor recession as a result of government policy. A series of eye watering tax hikes in 2014 resulted in sales volumes in central London decline by 50% and prices by 15% during 2015 and early 2016. David Adams had predicted that, had we remained in the EU, this price slide would have continued by at least another 5%. David also anticipated that the price fall would have been likely to extend into the mid market and into regions further from London. Sale Volumes had already been collapsing across the home counties for properties priced above £1 million pounds. This would have likely meant 20% off London property in the suburbs moving forward.

However, following the referendum, the sharp currency fall has brought us back to a 2009 scenario. After the major property price and sales volume collapse in 2008, quantitative easing and low interest rates lead to a collapse of the pound to just £1.10 against the Euro. This made property investment in London by foreigners a safe haven at a time when there were great concerns about a Greek default and exit. We now have a parallel situation; Low interests rates, a falling pound (11 percent against the US dollar, to levels not seen since 1985), uncertainty across global stock markets and the potential of a Grexit. Furthermore, there will be further instability as a result of other countries calling for referendums on their own EU membership. David expects, as a result, despite the outrageous level of property taxation in London at 12% to 15% stamp duty on transactions above £1.5 million, that bricks and mortar, in equally uncertain times, will again become the asset class of choice. This is likely to be supported by interest rates remaining close to zero for a longer time than had previously been expected. Money has to chase a return. Those buying in central London today from US currency backed countries are buying at 15% below peak prices with a further 11% discount on currency, or a 26% percent discount. In uncertain times that is certainly worth at least a small investment, especially when cash in the bank is no longer always seen as safe. Let us not forget that London remains one of the most attractive places globally to own a property. “For those few bankers and business people leaving for Europe as a result of the Brexit, there will be swathes of people coming from the Middle East and the former Commonwealth countries to do business with the worlds 5th largest economy. I know, because they are already calling me.”

“In London we have suddenly all been handed a major global business opportunity, the biggest in 40 years. It will be up to us to make of it what we can. The collapse of the political order in the UK, creates further instability and so there is likely to be hesitancy and uncertainty for the next six months. But I am also sure that future generations will say that this period was the best time, and best currency window to come and close a transaction in London, because when we do recover, as we are certain to do, the pound and the property market will be on a steep recovery trajectory.”