GREXIT to BREXIT to BUYIT

From one weekend to the next, it has been interesting how Brexit has gone from just a financial markets consideration, to a global mainstream media phenomenon.

As always things are not necessarily as they seem in those scary media headlines. Speak to anyone who has been part of any issue that became a news story, and they will tell you it wasn't quite the way the media enchanted and sensationalised it.

There are two specific points that are all important, and confirm for us that buying property, in fact all asset markets at the moment, is still one of the great opportunities of our life time. When everyone else figures this out and absorbs these two facts, then everyone will be wanting to buy. It is when others are cautious, even fearful, that we have an advantage. Really it is about seeing the light coming up, before anyone else does.

With regard to Brexit, the big shock for most people would be to learn that the referendum of itself does not take the UK out of the European Union. Even though the referendum has been treated and sold by the media as the inescapable beginning of a series of calamities. It does not even ensure that the UK will leave the EU.

This is because only an Act of Parliament can take the UK out of the EU. In fact there has to be an Act of Parliament even before the Prime Minister formally notifies the EU, that the UK will be exiting the Union. So the formal legal process is actually still a long way from beginning. The UK will only begin to leave the EU, should it follow the result of the referendum, at the earliest in two years time. The process itself will take a further 2-3 years.

The second point is that leaving the EU does not exclude the UK from doing business with Europe. It is just that it will not have as good trade and other exemptions as the members of the EU have with each other. The UK will continue to function just fine, as it always has, and will most likely re-negotiate new trade agreements with the EU that are still nonetheless favourable.

So this will take place over many years. There is no sudden wake up tomorrow and everything has changed as the media has portrayed. What occurs will be an almost as good as it currently is relationship with Europe. This is certainly not a catastrophe by any means.

Now I have left the best part for last. As leaving the EU would require an Act of Parliament, it is unlikely despite all the hubris, this will ever actually happen. You see across party lines the great majority of Members of Parliament are against leaving the EU. While some will give ground due to their particular constituency in some cases having a high “leave” vote, in the main, most will easily hold their ground in their respective electorates and still vote against such a bill.

The Prime Minister called the referendum as a kind of political stunt so people would stop complaining, but he allowed it to completely backfire. The referendum however, never had the legal power to take the UK out of the EU.

Brexit is a lot like Grexit. Greece never left the EU, and the results of their referendum were completely ignored. We should expect a similar outcome here.

The UK will never leave the EU.

After about six months of much talking, any Bill to leave will likely to be defeated. There will perhaps be a second referendum and then the majority vote will be to “remain”. Prime Minister Cameron has said “no” to another referendum, but it will not be up to him. Also by then, some allowances for more border and immigration control are likely to have been granted by the EU.

Suddenly the UK people will, in the main, be happy to remain.

Makes you wonder what all the fuss has been about doesn’t it.

My suggestion is to take advantage of peoples immediate misplaced hesitation over Brexit. It will soon go away, just as the then armageddon stories about Grexit did.

Brexit is just another buying opportunity.

Clifford Bennett