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Preparation is Key

As you are probably already aware, Mark Carney (The Governor of the Bank of England) today warned that 'a chaotic no-deal Brexit could mean that property prices fall by as much as 35%'. You've read the papers, you've seen the reports, and you could be forgiven for thinking there are four horsemen on the brow of the hill… there isn't.

I'm going to break down his sentence for the glass half empty brigade:

  • 1. 'A chaotic no-deal Brexit' – this is seen as possible, but not probable. Even Michel Barnier is starting to sound optimistic about a deal being struck in the best interests of all concerned. We have to plan for these worst case scenarios or risk being in a very difficult position should the worst happen… if they didn't plan, we'd all be calling them incompetent. Mark Carney stress tested the impact of an extreme financial shock and the results were indeed shocking – the banks would all be fine.
  • 2. 'could mean' – I'm not going to go too much into this, but let's just say he's not 100% sure.
  • 3. 'property prices fall by as much as 35% - the worst case scenario that is being stress tested says 35% is as bad as it will get. Admittedly, that's pretty worrying - if you forget the parts where it says this is the worst possible result from the worst possible situation.

Preparation is key, but perception is everything. You may be a 'glass half full' or a 'glass half empty' type of person – the reports that you've read today are based on there being no water in the glass whatsoever!

My advice is to keep calm and carry on… nobody knows how this is going to pan out (not even those negotiating the deal). There are many twists and turns ahead and the uncertainty certainly doesn't help the property and financial markets. If the media could refrain from misinterpreting statements and scaremongering the general public however, it would go some way to providing a degree of clarity.

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