ORLANDO — In most instances, uncertainly is anything but a friend to the real estate market.
If someone is worried about their job, they don’t buy. If they have rising medical bills and don’t know how costly they’re going to get, they hold off on that crucial decision of whether or not to purchase a home. Even a relationship turning sour can keep a buyer from contacting a real estate agent.
But for residents of the United Kingdom, a growing degree of uncertainly leading up to June 23 holds out the potential to make the real estate market seem considerably more attractive – although not in their native country, but in the U.S. An upcoming vote on the future of the United Kingdom’s role in the struggling European Union has already had an impact on the local real estate market – while at the same time, making an investment in the American housing market not only looks more attractive, but financially safer.
An Flamand, the owner and broker at An Flamand-Orlando Vacation Realty, noted that this situation has created uncertainty in the EU — and uncertainty in the second home market. The real estate brokerage based in Orlando, Florida understands the international market and the reasons why so many European buyers are now looking across the ocean to the U.S. when it comes to purchasing a second home. In contrast to all the political uncertainly happening in Europe, Flamand noted, the U.S. – and Central Florida in particular – offers an oasis of strong investment opportunities.
As Flamand noted, England is at something of a standstill at the moment – and has been ever since UK Prime Minister David Cameron announced the country would hold a referendum on Britain’s role in the European Union. Scheduled to be held on Thursday, June 23, it’s a vote on whether to stay in the EU — an economic and political partnership involving 28 European countries which has grown to become a single market with its own currency, the euro, used by 19 of the member countries. The EU also has its own parliament and sets rules in areas ranging from the environment to transportation to consumer rights.
Although Cameron has pushed to remain in the EU, other leading politicians, like London Mayor Boris Johnson, support the “out” vote. Until the vote is taken, it’s unclear how either an “in” or “out” vote would impact England, its economy – and the real estate market there.
The impact on the market has been uncertainty, and a lot of companies are at a standstill, not investing in expansions because they’re waiting to see the impact of the vote.
Although supporters of the “out” vote want to see England become fully independent, there’s been a higher degree of independence in the UK since joining the EU, as compared to other countries. England is the only country to keep its own money system, the pound, rather than adopting the euro, the money system that every other country switched to.
What’s not clear now is what changes if England pulls out completely from the EU. For a lot of UK companies, that possibility poses troubling questions about whether that will make it harder to conduct business throughout the rest of Europe – and whether it still makes sense to maintain their headquarters there as a result.
Another aspect of this issue is ongoing efforts in the U.K. to discourage foreign investment in the real estate market, particularly among Russian and Chinese buyers, who are inflating already sky-high prices for local homes.
As Flamand noted, right now there are not enough homes in the UK available to buy, so there is a literal desperation in some areas for property. So to protect struggling UK buyers from competing with foreign money, Chancellor George Osborne introduced a new Stamp Duty Land Lax, paid on all Buy-to-Let (BTL) investing. It goes into effect in April, and is expected to lead to an increase in rental prices across the UK as prospective buyers opt to rent instead.
The government is putting penalties in place to stop the foreign money coming in, but that’s also put a halt to buying.
That means until the UK votes on that June 23 referendum, the economy is at a standstill, and the impact of the fast-approaching SDLT is crippling the real estate market. So what is a buyer to do?
As Flamand noted, the United States remains a nation with a strong dollar, a growing economy – and a very durable real estate market. That’s especially true in Central Florida, which has one of the nation’s strongest and most vibrant economies. The unemployment rate here is 4.4 percent, below the national average of 4.9 percent. That economy and improving job market is one of the reasons why the region continues to attract thousands of newcomers from across the nation each month – and why builders are responding by ensuring there’s enough housing to accommodate them.
An Flamand-Orlando Vacation Realty has an exclusive agreement with the developers of the new Posner Estates development – and the first phase of pre-construction has already sold out!
Posner Estates, which recently celebrated its groundbreaking, will be a gated community of new townhomes constructed near Posner Park, a popular commercial plaza in Davenport. Projects like this one offer British and other European buyers an opportunity to invest their money wisely – not only in the development itself, but also in an economically diverse and vibrant region.
At the same time, An Flamand-Orlando Vacation Realty has been invited to join Mayfair International Realty, a prestigious network of more than 100 of the finest brokerages in the United Kingdom. That opportunity has given An Flamand, the principal broker of An Flamand-Orlando Vacation Realty, an enhanced ability to assist European clients looking at the Central Florida’s housing market.
To learn more, call (001) 863-424-3835 or email an@OrlandoVacationRealty.com.