UK: Global investment company DeVere Group is temporarily halting all its UK property investment in the wake of growing economic upheaval.
The company said that, with immediate effect, it will temporarily close its property investment division.
James Green, DeVere Group investment director, said: “We are concerned about the availability of credit and, therefore, an imminent drop in property prices so we are temporarily suspending all property investment projects. We understand many clients around the world will be concerned about current mortgages and protection and, as such, we have put together a dedicated team to assist with these enquiries.”
The move comes days after UK chancellor Kwasi Kwarteng announced his tax-cutting mini-budget, which caused the value of the pound to fall to its lowest rate against the dollar since decimalisation.
The mini-budget came under fire from several organisations including the International Monetary Fund (IMF) and prompted lenders to withdraw nearly 1,000 mortgage products from the market.
Nigel Green, chief executive and founder of DeVere Group, which has more than $10 billion under management, said: “The Bank of England’s chief economist has indicated that interest rates could rise sharply imminently. The markets are already pricing in 5.8 per cent by next March. But I would not be surprised if interest rates reach above seven per cent in the spring.
“Understandably, lenders are suspending mortgage offers and, in turn, we’re now suspending our property investment division. A result of the mini budget is that mortgage prices are set to increase, and borrowers are to have less options. The chancellor and prime minister Liz Truss have recklessly gambled with the UK economy. The pound, gilt market, the stock market, and now the property market all reacted phenomenally negatively to their plans as the pull away from UK plc gathers momentum,” he added.
Despite a partial government U-turn on scrapping the top rate of income tax, Green concluded: “Investors’ trust in UK plc has had a hole blown through it.”
