A LEADING property expert says the re-election of Donald Trump to the White House will have a significant impact on house-markets across the globe.
Alastair Brown, the CEO of the ABI Group, a Florida-based real-estate agency specialising in Florida holiday homes and Reunion Resort properties said the impact will be felt in the UK market – and beyond.
He said: “In terms of the knock-on effect to the UK, the recent Budget was obviously the key driver which will have the most impact. But anyone who thinks the outcome of the US presidential election will have no effect on UK property investors, would be mistaken. In fact, the re-election of Donald Trump could have a huge effect on the value of investments .
“There’s the possibility that it could pave the way for more favourable economic conditions for property investors in the UK.
“The fears that corporation tax and capital gains tax could be hiked under Kamala Harris have receded, which might pave the way for a more conducive environment for investors.
“The prospect of a new tax on ‘unrealised gains’ from property sales at 25% has also receded will also calm nerves stateside.”
Explaining the “major role” foreign investment plays in the UK property market, especially in prime central London locations, he continued: “US investors are key in funding large scale developments in the commercial sector, particularly those related to fossil fuels and mineral extraction.
“Trump’s policies, focussing on low taxes and de-regulation, not only promise to provide a stable environment for investors, they should also give the UK government pause for thought on further tax increases here.
“Combined with his control of the Senate, there promises to be a sea-change in the political and economic handling of the world’s largest economy.”
Outlining what he thinks will happen once Trump returns to office, he explained: “Taxes are likely to be kept low and there will be pressure on the Federal Reserve to bring interest rates down, putting pressure on the Bank of England to do likewise.
“The pace of interest rate cuts in the UK had been forecast to slow following the election of a Labour government, but this could force a re-think.
The signs of optimism were immediate, with a surge in stock prices when the US markets opened today.
“The rumoured appointment of Elon Musk to Trump’s cabinet could be seen as a signal that large public expenditure cuts are coming.
Setting out the potential problems he added:“There are some potential downsides for the UK property market, in that there could be additional pressure put on the public finances if he follows through on threats to drop links with NATO or scale down US involvement in the Ukraine conflict.
Labour has an ambitious plan to build 1.5 million new homes and there may be repercussions for funds earmarked to support that policy and spending on public infrastructure projects as well.”