Matthew Tooth: Last-minute Brexit deal would be best for industry
A last-minute Brexit deal with the European Union would be the best outcome for the bridging industry, Matthew Tooth, chief commercial officer at LendInvest, has claimed.
This comes at a time when Prime Minister Boris Johnson has finally outlined his “final” negotiating offer for Brexit.
The plans include replacing the proposals for an Irish backstop with an “all-island regulatory zone” – effectively leaving Northern Ireland inside the EU’s single market for goods.
Tooth (pictured) said: “The best outcome for the industry would be a last-minute deal but it could be very last minute and could involve giving something up in Northern Ireland and doing something they’ll only mention at the last minute.
“It could be hanging those guys out to dry which I wouldn’t put past Boris. Probably the best outcome for the industry is a deal.
“I still think a deal is the best outcome for UK and UK property sector and the sooner the deal the better. A deal avoids a no-deal and provides certainty sooner.”
He said that Brexit uncertainty has impacted buy-to-let purchases but has accelerated refinances.
Tooth added: “There’s definitely been an impact on developers’ beginning schemes and an impact on exits being sold.”
Gary Bailey, managing director of Hope Capital, agreed a deal is the best outcome.
He said: “I think there are a number of scenarios that could play out but although all unlikely, none are impossible.
“We’re in unchartered waters now and specialists can’t predict what’ll happen. Boris Johnson is willing to disrupt everything and with Jeremy Corbyn there are MPs in his own party who don’t want him to be Prime Minister.
“I think the only thing we can hope for is that Boris comes out with a deal. I think that’s the only direction they can take it now rather than try and find loopholes in all the other stuff.
“The answer is to find a deal.
“The key to whatever happens with Brexit, whatever Brexit it may be, a deal or no-deal, is the timing of clients. Some will pull us and see how it all weighs up, others will see it as a big opportunity and jump in straight away.
“The mainstream will have their own challenges trying to adapt into a post Brexit world even though they’ve planned it. That will be a huge change for them and that will help the demand within our sector.”
Brian West, director of Central Bridging, argued that taking no-deal of the table and forcing Parliament to come back has undoubtedly weakened Johnson’s negotiating position with the EU.
West said: “You don’t go to DFS and ring them beforehand saying you’re definitely going to buy a sofa. You go in prepared to walk away and if you do everybody gets a deal.
“I was at an event where Andrew Marr was the guest speaker. He was pretty adamant we’ll be out of the EU by the end of this year which was quite interesting. I don’t necessarily share that belief.
“In the UK, and particularly in London, if a deal gets done there will be a boost in terms of a feel-good factor.
“If a deal is not done and we come out on a no-deal basis, then there’s reason to assume Sterling devalues more and we become more attractive to overseas investors and the market kicks up anyway.
“The London market ticks up if we get a deal or not and if London starts to move in the right direction then other areas already moving in the right direction benefit further.”
Sundeep Patel, head of London intermediaries at Together, said that a lot of landlords have been stockpiling their equity like they did before the buy-to-let tax changes.
He said that they are seeing it as an opportunity and are waiting for the outcome, whatever it may be, and are waiting to pounce.
Patel added: “In terms of opportunity I think it’s there and I agree demand from foreign investors is still there in London.
“Once it happens everyone wants it to be happen and get it over with but from our point of view there is opportunity.”