The majority of UK investors are worried the government’s handling of COVID-19 and Brexit will have a negative impact on the economy, according to new research from FJP Investment.
The investment firm found that 63% of investors are concerned that the handling of the pandemic by the government will result in a long-term recession.
FJP Investment commissioned an independent survey of more than 1,000 UK-based investors, all of whom have investments and savings in excess of £10,000, excluding the value of their residential property and workplace pensions.
The findings also revealed that 41% are worried about the impact Brexit will have on their finances, which increased to 53% for those with an investment portfolio valued over £250,000. With Brexit negotiations stalling, the study also indicated that over half (53%) of investors are expecting a no deal outcome by 31 December.
As a consequence of COVID-19 and Brexit, only 42% of investors believe the UK will remain a global investment hub, the research also showed.
FJP Investment CEO, Jamie Johnson, suggested the economic disruption caused by COVID-19 “clearly has investors worried”.
“With the Bank of England downgrading its latest GDP growth forecasts and announcing a further £150bn economic stimulus, investors are concerned there is still a long way to go for the UK to overcome the pandemic-induced recession,” Johnson said.
“At the same time, the lack of progress between London and Brussels on Brexit negotiations is posing further challenges. A no deal Brexit is looking increasingly likely, and this uncertainty is making it difficult for investors to plan for the future.
“Despite these issues, however, our research shows that investors are still positive when it comes to property.”
With the stamp duty holiday coming to an end on 31 March 2021, FJP Investment also found that 40% of investors are expecting house prices to increase in 2021. This compared to just 19% who expect them to fall.
“House prices have been growing at a remarkable rate recently and many investors are confident this will continue over the course of 2021,” Johnson added.
“This is important – any attempt to stimulate investment and economic growth will be boosted by a vibrant property market. As such, it is vital for the government to implement policies that sustain this interest over the long-term.”
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