As the European Union’s economic crisis deepens, the prospect of a UK exit from the bloc could be on the horizon.
But with the pound, the euro and the single currency in a tailspin, the real estate market could rebound to some extent, according to an analyst at brokerage firm Cushman & Frierson.
Rising property prices in the United Kingdom, which is facing the biggest economic crisis in its history, could fuel a rebound in house prices, the brokerage firm said Tuesday in its report, Real Estate Rent and Landlord Rent.
With the UK’s housing market in shambles and a surge in demand, real estate rent is on the rise, the firm said, noting that this is likely to lead to a surge as the pound depreciates.
Rent in England and Wales is on track to rise by 2.7 percent this year, according the Cushmans Real Estate Research & Investment report.
But the report notes that this would not be sufficient to offset the decline in the pound.
The British pound, which has lost almost a quarter of its value against the euro in just three months, is trading at around $1.12.
The firm noted that while the British economy is “in a period of stagnation” and the country is facing a “severe recession,” the economy could see a “recovery in housing prices.”
“The economy may not recover as rapidly as it would if the pound fell further, but a recovery in housing demand could drive a boost in prices,” the report said.