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Mazaya Monthly Real Estate Report -
Week 1 - July 2016
Al Mazaya’s report further adds that
the Brexit decision could affect Gulf
and global investments into Britain,
as well as investments in many
European countries which have direct,
large-scale financial and economic
relationships with the British economy
– particularly the Netherlands, Belgium,
France and Italy. Moreover, all the IMF
expectations are negative in respect
of a Brexit. With expectations for
the British economy to enter a state
of slowdown, the UK is expected to
suffer an immediate downturn in the
coming year, thereby having a negative
impact on Britain's economic partners.
It is worth mentioning that the real
estate sector has held the most negative
expectations to this new political reality,
with observers expecting that the real
estate market in Britain will not be able
to avoid a fall in its prices up to the end
of this year. Increasingly, estimates
suggest that the real estate market will
undergo a process of tangible price
corrections, which had increased over
the last quarter as a result of low supply.
In this context, it is worth mentioning
that the financial and tax restrictions
on the purchase of “houses-to-let”
will force several investors out of the
real estate market, thus inducing more
adjustments on the prevailing prices.
Expected increases in interest rates will
also mean higher costs on mortgage
loans, thereby creating falling demand.
Al Mazaya’s report has also assessed
Qatari investments in the British economy,
which are distributed over several sectors.
Foremost of which is the real estate
sector, in particular: hotels, residential
and commercial towers, the Olympic
villages, bank and stock exchange shares,
as well as investments in the energy
sector. These investments are estimated
at USD44 billion, although the value of
Qatari investments is likely to still increase
given the absence of comprehensive data.