UK voted to leave the EU, with only Scotland, Northern Ireland and the City of London voting in favour of remaining in the European Union. There was an unprecedented sell-off in the early hours as the results were announced, with the stock market, particularly bank shares being hardest hit by the seismic news.
The pound hit its lowest levels in 30 years as is it touched GBP/USD 1.32 and the GBP/EUR pair dropped to around the 1.23 mark.
And more recently with the UK losing credit rating, David Cameron’s unsurprising resignation, and the rumblings of a second Scottish referendum, it is understandable why so many fear for the future of the UK, both economically and socially.
Similarly, for the 1.3 million or so Brits living within the European Union and possibly more so for those planning to move to Europe on a permanent or semi-permanent basis.
Where exactly does the Brexit results leave British Expats?
In the run-up to the EU referendum, British expats and holiday homeowners raised their concerns about the impact of a Brexit. And their concerns are well founded. European Union benefits often taken for granted such as freedom of movement, essential for overseas homeowners could come to end. Similarly, pensioners using national healthcare services of host countries, unable to afford private healthcare may have no choice but to return to the UK.
However, what should be made clear is that we are currently at an acute time in the UK, indeed the EU’s history at this moment. Markets, politics and public sentiment is likely to be volatile with talk and speculation right now, but this will calm.
In fact, thus far sterling-euro has not fallen to the worse-case scenario prediction. Although we still anticipate significant peaks and troughs in the coming weeks, with the Bank of England pledging to stabilise the markets and the promise of a new Prime Minister by October, things are not as negative as they may initially seem.
Indeed even the FTSE 100 and 250 have taken back some of its initial losses. Yes, in the short to medium term, the sentiment is expected to remain subdued with the weaker sterling attracting more overseas property investors. Once the tide of hype has subsided and the markets have settled, however, not much will have changed for Brits owning property within the EU, apart from it becoming only slightly more complicated than it currently is, which in truth has been relatively easy compared to other foreign destinations.
The bigger more immediate impact is on exchange rates. For those considering or about to buy property overseas, they would be wise to manage their exposure to further falls in the value of the pound. Thus far sterling-euro has not dropped to the predicted worse-case scenario. However, we still anticipate significant peaks and troughs in the coming weeks, with the Bank of England pledging to stabilise the markets and the promise of a new Prime Minister towards the end of the year.
British expats, people looking to move overseas or those contemplating purchasing property, essentially anyone concerned about how Brexit decision will affect their future transactions should contact one of featured currency specialists to discuss possible solutions.