Richard Pickering, Head of UK Research & Insight gives a personal view of the business and role of property in new Europe. This is the first of his New Europe weekly email updates.
Following two of the most dynamic weeks in UK political history, we recap on some of the main stories and provide a view on the themes for real estate looking forwards.
What were the odds? At 22.00 on 23rd June, and with no exit poll on which to base predictions, Ladbrokes was implying a 92% probability of Remain, the FTSE 100 had bounced up 130 points, and the pound had rallied to £0.67 to the dollar. And yet the world woke up the following morning to the most radical political decision in the UK’s recent history.
Geography and age. The result shines a spotlight on a divided nation, with London, Scotland and Northern Ireland firmly Remain, and most of the shires voting Leave. Calls for further devolution of powers to the former group are expected to be renewed, with the future of Scotland given the greatest emphasis. Press and social media have been quick to note that pensioners voted Leave by the clearest margin (39% Remain). Less cited, is that that the young (73% Remain) took limited accountability for their voting preference, with only 36% of 18-24 year olds thought to have turned out to vote.
Immigration and inequality. Bureaucracy, sovereignty and particularly immigration are closely connected to the Leave vote. Those who predicted economic improvements arising from Leave are surely in the minority. The vote highlights a level of disenfranchisement felt acutely in some areas of the country, with Eurosceptisism perhaps acting as a proxy for anti-establishment sentiment. As a society we need to look hard at inequality and engagement issues and how these are unequally distributed across geographies.