Unless you’ve been living under an Austin Powers VHS the last 24 hours, you have likely heard about 52% of Britain’s population voting to leave the EU (European Union). Since the vote was passed, the British pound has plummeted to its lowest value to the American dollar since 1985, and the Dow Jones is off by more than 500 points. This is a devastating blow to the British economy, but what does it mean for NYC real estate?
What is EU?
The European Union is a politico-economic union of 28 member states that are located primarily in Europe (Wikipedia). The EU operates to allow free movement of goods, capital, services, and people between member states.
What is Brexit?
Brexit is a combination of the words “Britain” and “exit”. Basically, Brexit supporters feel the UK has lost influence and sovereignty on the international stage, while “remain” supporters argue that the UK needs to be part of an institution like the EU to increase its influence.
What Brexit Means for NYC Real Estate
The value drop of the British pound and the Dow Jones fluctuation could be a knee-jerk reaction, but the British elite won’t take risks with their financial future. In the coming months, we expect to see an influx of European buyers putting their money in NYC investment properties.
TripleMint’s VP of Sales, Jennifer Lee, says, “Money will flow out of the U.K. as sterling weakens and into U.S. assets. Longer term we should see stabilization as the U.K. figures out post-Brexit logistics. But for now, good signs for NYC real estate.”
NYC real estate has proved in recent years to be a relatively safe investment. British buyers won’t be taking up residence in these purchased units, so the immediate demand for NYC luxury condo properties will increase in the short term.
TripleMint’s Head of Sales, Tyler Whitman shared that he knows of three British investors who have already contacted agents in NYC about parking their cash here until the British economy settles.