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Wealth Management

HOW TO BREXIT-PROOF YOUR PROPERTY INVESTMENT

  • Acentus Real Estate advises investors to seek out a dynamic, growing city with a diverse economy
  • Average UK property price rose 6.2% in 3 years following Brexit referendum (HPI)
  • Midlands/North projected to see property price growth of 15.3% from 2019-2023 (Savills)
  • Liverpool’s Metalworks perfectly positioned to benefit from city’s regeneration work
We live in uncertain political and financial times. The UK’s July growth figures have eased fears that the country could fall into a recession, with the economy growing by 0.3% during the month. The public, however, are still being cautious, with HomeWorkingClub.com reporting an increase of more than 1000% in people Googling “how to prepare for recession” in the year to August 2019.
While talk of recession seems to be abating for now, we still have Brexit to contend with. Parliament may have shut down for the next few weeks, but the rest of the country is carrying on apace. For those investing in the UK’s property market, the spectre of Brexit has been something to contend with for over three years now. Despite fears around Brexit’s potential impact, property prices during that time have risen from an average of £216,750 to £230,292, according to the government’s House Price Index.
That means that investors who ignored the dire warnings about the Brexit vote triggering a housing market crash have enjoyed an average 6.2% increase in the value of their properties since the referendum.
“While Brexit does add an element of uncertainty into the proceedings, nobody can ever predict what the future holds, so investment always carries an element of risk. That said, property investment in the UK comes with some solid market fundamentals behind it. Not only that, but there are steps that you can take to minimize your exposure and essentially Brexit-proof your property investment!”
 
Leanne Black, Sales Manager, Acentus Real Estate
Some of those who are best placed to project what may happen in the future are the property experts at Savills. Their five-year forecast highlights the value of property investment in the UK’s Midlands and Northern regions, with prices forecast to enjoy growth of 15.3% between 2019 and 2023 – higher than any other area of the country. At the same time, JLL highlights the potential of regional cities when it comes to the private rented sector, forecasting average rent growth of 17.6% in Liverpool between 2017 and 2022.
Independent property service Acentus Real Estate is working with investors who are drawn to the long-term potential of the regional UK housing market. Years of undersupply, coupled with population growth and demographic changes, have placed significant demand on the market. The UK hasn’t been building homes at a sufficient pace to keep up with demand for well over a decade, if not two. This fundamental lack of supply remains the same regardless of the country’s political manoeuvring with the EU.
In terms of Brexit-proofing a property investment, the Acentus team have a number of tips. Firstly, find a city that’s got an expanding population and healthy, growing GDP. Second, look for one that has a diverse economy, so that its economic success is not dependent on one particular industry or sector. And thirdly, consider how much the city is investing in its own regeneration. Does it have big plans for the future? If so, those plans could do much to support the future growth of the city’s housing market – certainly in the area around the regeneration schemes, at least.
The Metalworks in Liverpool ticks all the right boxes in this regard. Adjacent to the city’s business district (for which major regeneration plans are currently under discussion) and a few minutes’ walk from the city centre, The Metalworks will deliver 319 stylish, urban apartments spread across two blocks, connected by a 24-hour concierge service and beautiful public realm. The contemporary city homes have been efficiently designed to make maximum use of space, while bedrooms and living rooms feature floor-to-ceiling windows, flooding the homes with natural light and providing impressive city, garden and river views.
Liverpool itself is thriving. Not only does the city regularly top the UK’s list of areas where house prices are rising fastest, but its tourism sector is booming, with visitors attracted to its creative, cultural and musical scene, as well as its museums, historic buildings and, of course, its football ground. Those who live and work in the city have seen it change hugely in recent years, with regeneration work spurred on both before and since its 2008 ‘capital of culture’ status.
 
“If you’re seeking a UK city that has all the right conditions for being Brexit-proof, so far as anywhere can be, then it has to be Liverpool! The city has such an incredible amount going for it, which is why it is booming in terms of both population and visitor numbers. It’s the ideal place to invest in property in order to capitalise on the potential for both capital gains and rental yields.”
 
Leanne Black, Sales Manager, Acentus Real Estate

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Wealth Management

THE TRIALS AND TRIBULATIONS OF TRADERS TRADING FROM HOME

HOME

Steve Haworth, CEO of TeleWare Group

Banks had hoped to keep their London trading floors open amid the worsening coronavirus pandemic, insisting traders were “key workers”. But trading floors were quickly cleared and employees sent to work from home in isolation.

Firms needed to quickly adapt to remote working. This meant recreating the carefully monitored environment of the trading floor at thousands of sites.

With major disruption across the entire sector, it seems the Financial Conduct Authority felt no other choice but to relax regulations on recording calls. But does this measure introduce more problems than it solves?

 

Why call recordings are regulated

Whilst regulations differ globally, authorities in the UK, US and Hong Kong have long required trading floor phone calls to be recorded for certain activities.

In the UK, the FCA demands financial institutions keep records of all trades and transactions related to certain types of business for at least six months. Recording calls and reporting trades are essential to the regulators’ ability to monitor the markets for abuse, such as insider trading. Requirements to record calls apply to companies that receive and execute client orders to buy or sell in the financial markets.

Steve Haworth

Each trading floor in a financial firm also has its own set of policies which staff must abide by. For instance, the trading floor manager must ensure that all trade-based calls are recorded and monitored. An often-used policy that still exists is to ban all mobile phones on the trading floor. To enforce this, mobile phones are often stored in lockers and traders are required to use turrets to host calls.

Beyond call recording, most traders and salespeople need to sit together on a monitored trading floor in order to meet regulatory rules. A range of compliance complexities under GDPR, MiFID II and Dodd Frank have meant working from home has simply not been an option for many traders.

 

The rush to relax regulations

Traders are now required to work from home – if they can. The FCA has said it accepts that some scenarios may emerge where recording calls may not be possible. Adding that it expects companies to “consider what steps they could take to mitigate outstanding risks if they are unable to comply with their obligations to record voice recordings.” If financial services companies are unable to record calls they are then expected to “come up with a plan to fix the problem”.

Yet, trading firms have enough problems to solve without having to decipher call recording requirements. Why should traders spend extra time updating the FCA and coming up with an alternative solution when one already exists?

 

A smart alternative

Smart solutions – such as mobile call recording which meet global regulations – have perhaps been overlooked as a way to maintain business continuity.

Mobile voice recording technology (MVR) is not new. It has existed since 2011 and includes secure and reliable voice and SMS recording, easy to use conferencing and robust, accessible voicemail. It has matured over the years and proven itself to be flexible and highly reliable.

Technology can keep traders trading from wherever they are. Ensuring they can operate effectively at home while remaining compliant.

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Business

STOP THE CONFUSION: HOW TO KNOW IF YOUR BUSINESS MAY BE INSURED AGAINST COVID-19

COVID-19

By Alex Balcombe, Partner at Harris Balcombe

 

The last few weeks has seen businesses in hospitality, tourism, retail, leisure and more forced to close their doors following the Government’s orders that they should close to prevent the spread of coronavirus.

While this is expected to flatten the curve and reduce the number of coronavirus cases, it will of course have an impact on businesses and employees alike.  For small businesses especially, there are many concerns about how they can claim on their insurance to weigh the fall of this impact.

 

Mixed Messaging

In response to calls to help struggling businesses, the Government has informed the public that companies who are facing turmoil will be able to claim on their business interruption insurance during this difficult time. For most, this is wrong.

Alex Balcombe

The insurance industry has also been extremely vocal that there is no cover for any coronavirus-hit businesses during this tough financial period. This isn’t strictly true either.

How can businesses see through the mixed messaging and best secure their future and their livelihoods and reduce money worries? It’s an extremely stressful time for many companies, and confusion over whether or not they can be covered can only cause more unnecessary stress.

Since it’s a new disease, most businesses will not be covered for business interruption due to COVID-19. In fact, the vast majority of policies do not cover anything related to COVID-19.

That said –  don’t rule out the idea that you may be covered. There is a chance that you will be covered against COVID-19, but not know it. This is a very small chance, but your current cover may already protect your business against the consequences of coronavirus, and the nationwide response to it –  though those with this cover are unlikely to realise it.

 

How Could I Be Covered?

Not everyone has business interruption insurance, as it’s not a legal requirement. It is entirely up to the policy holder to weigh up the benefits of having it, and their ability to trade should a disaster happen.

To be considered for cover for COVID-19, there are two types of policy extensions to your business interruption cover that can potentially cover you for this situation:

Infectious Disease Extension 

Many policies expressly state which diseases fall within the realm of being an infectious or notifiable disease. If this is the case, your policy will not provide cover. As it is a new disease, these policies will not have included COVID-19.

Other infectious disease extension policies will define the disease with reference to the actions of the government. Since the UK Government has named COVID-19 as a notifiable disease throughout the UK, it is possible that your business may fall into this definition, thus meaning you may be able to make a claim.

However, again, it’s not always that simple. Many policies require the disease to have been on your premises, while others specify a radius from your premises in order to qualify.

 

Denial of Access Extension (non-damage)

Denial of Access Extension (non-damage) policies may cover you if you’re prevented from accessing your property. This could be due to an event, or by the actions of a competent authority, which could cause your business interruption cover to engage.

If covered by this clause, there are often very subtle differences in wording in your policy. This could depend on the insurer or policy. You may well be covered, but it will depend on your particular circumstances, and the specific policy wording.

 

What now?

It’s clear that the Government needs to do more in ensuring there is clear messaging for businesses, and to help the insurance market look after policy holders. This is an unprecedented situation, and with many people looking to claim on their insurance, we’re already seeing major delays which could have a domino impact.

People throughout the world are understandably facing all kinds of worries because of the current pandemic. Our ways of living have changed, and many business owners will not have experienced a situation like this in their life times. If you own a business and are unsure about whether you can claim for business interruption, or are confused about ambiguous wording, get in touch with a loss assessor.

These claims are not simple, but loss assessors will be experts in business interruption insurance, and will specialise in large and complex claims. They will be able to help and guide you along the way, check your wording and work on your behalf to make sure you get everything you are entitled to.

 

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