Steve Morgan's article on the wide reaching effects of the low oil prices is a vital reminder that the property market floats on a very changeable economy (and a global economy, at that)! The Middle East is built around the export of oil at £100 per barrel. Now that the price is hovering around £20, they are staring down a non-too-pleasant barrel of a different kind.
Shari’ah finance was billed to be the next big thing in the property investment market as recently as last year (yours truly even proffered an opinion, here). However, the investment from European sources has proved far more relevant to developers.
Euro-sceptics are making big statements about the availability of funds from outside the EU but the savvy would keep a weather-eye on the Middle Eastern economy. As Morgan says, the cheaper energy and fuel costs may actually benefit the UK property market. However, in a brave new world where the Brexit has happened, our still fragile market would not welcome any further uncertainty.
UK impact Nevertheless, overall levels of investment from the Middle East in UK property, which has averaged around £4bn per year over the past three years, is likely to dip - unless, of course, new investment from Iran, as a result of the lifting of sanctions, offsets the fall expected from the sovereign wealth funds.