Gibraltar & Brexit 1 month on

It is now just over a month since Britain voted by a small but sizeable majority to leave the EU.

In their desire to secure votes, both sides of the Brexit debate painted doomsday scenarios to the UK electorate and the misleading claims by both camps undoubtedly played a vital role in the outcome of the vote.  

Who can forget the Leave campaign’s factually incorrect statements of £350m a week going to the EU, and how that could go to the NHS instead, or the Remain campaign’s claim that three million jobs were dependent on Britain staying in the EU bloc?    

Both of those claims, and many more were shown to be factually incorrect, but statements like those nevertheless played an intrinsic role in the outcome of the Referendum and will invariably lead to Theresa May triggering Article 50 of the Lisbon Treaty within the forthcoming months.

So, how is Gibraltar coping post Brexit?

The highest share of the vote achieved by the Remain camp was in Gibraltar, where a resounding 95.9% of voters backed the Remain campaign.  Clearly, the vast majority of voters on the Rock believed Gibraltar’s best interests were served by being within the EU and still do.

Whilst we may not agree with the sentiments of those that voted to leave the EU, we live in a democracy and have to respect their point of view was in the majority.  Clearly the motivation behind their decision was based on a different perspective and circumstances to our own in Gibraltar, but the reverberations of the Referendum will result in Gibraltar, Scotland, Northern Ireland and England having a different relationship going forward with the EU.

Having been at the forefront of the local property market in Gibraltar for nearly three decades, we have naturally been in contact with many investors and property owners since the Referendum, and despite the pre-referendum fears, we have yet to see any negative impact on the local property market.  

In fact, as soon as the Referendum vote was known, we saw a surge in rental enquiries which has actually resulted in local rental prices rising as demand outstrips supply.

A substantial number of our clients have also bought off-plan properties in developments that are currently under construction, and unlike the Global financial crisis of 2008, every single client of ours intends to proceed with their property purchase – which in itself shows the confidence that local and overseas investors have in our long-term future. 

It cannot have also escaped investors’ attention that under recent changes to the law, when a newly constructed property is rented for residential purposes, the Landlord can receive a tax credit equal to the tax payable on the profits earned on the first twenty-four months of rent occurring in the first five years after the completion of construction of that property.  

The way ahead is not going to be all plain sailing, but Gibraltar’s determination and ability to punch above its weight on the international stage stands us in good stead to manoeuvre the choppy waters that lie ahead for the whole of Europe.

Kind regards

Justin Bray