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deVere group pulls all UK property investment projects

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One of the world’s largest independent financial advisory organisations is to pull all UK property investment projects amid heightening economic upheaval

deVere Group, which has $12bn under advisement, says that with immediate effect it will temporarily close its property investment division as inflation fears grow, which suggests that the Bank of England will have to continue to hike interest rates more aggressively to combat rising prices.

James Green, deVere Group Investment Director, explained: “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 news comes as the International Monetary Fund (IMF) has spoken publicly for the first time about Britain’s intensifying economic spiral. “We are closely monitoring recent economic developments in the UK and are engaged with the authorities,” said a spokesperson.

Nigel Green, the CEO and founder of deVere Group, also commented: “The Bank of England’s chief economist has indicated that interest rates could rise sharply imminently,” he said. “The markets are already pricing in 5.8% by next March. But I would not be surprised if interest rates reach above 7% in the spring. Understandably, lenders are suspending mortgage offers and, in turn, we’re now suspending our property investment division.”


Mortgage borrowers now have fewer options

Nigel Green said that a result of the mini budget is that mortgage prices are set to increase, and borrowers are to have less options. “The Chancellor and PM Liz Truss have recklessly gambled with the UK economy,” he said. “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.”

There was a barrage of criticism of UK fiscal policy coming out of the wealth management sector this morning, even as prime minister Truss and her chancellor Kwasi Kwarteng attended the annual Conservative party conference in Birmingham. The government’s U-turn decision on the axing of the top rate of income tax was being regarded as a sign of weakness from the current administration and a sign of their further malleability.

“We are governed by people with no spine”

“Above all, this U-turn signals to the world that we are governed by people with no spine,” said Nick Lincoln, director of Values to Vision Financial Planning. “The irony is that the markets were not spooked by the income tax fiddling. They were spooked by high inflation and the enormous energy bill supports, and on that front nothing has changed. It’s a symbolic move but one that will likely do nothing to counteract the pressure on Sterling.”

Alex Sharp, founder of Blackmount Private Wealth in Glasgow was similarly condemnatory: “Politicians attract ridicule for changing their mind on important matters,” he said. “In this case, I can understand why. The government clearly believes in this policy but has succumbed to political pressures. Reversing the abolition of the 45% rate now only adds to the chaos and uncertainty. Financial and currency markets reacted as they did to the mini-Budget because it was unsubstantiated. They lost confidence. A flip flop doesn’t restore confidence.”

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