Brit expats in UAE reluctant to remit due to sterling volatility

The sterling slump following the Brexit referendum result was a gift to British expats in the UAE dedicated to sending money home or investing in British buy to let properties.

Following an initial flurry of remittances and over the next year or so, the pound made up some 10 per cent, making sending money home less of a temptation. Now that uncertainty over Brexit is at it’s highest point since the poll, the pound is reacting by falling further and expats have another opportunity. At the present time, the UK’s relationship with Europe is hanging in the balance, as is the state of sterling.

For those being paid in US dollar-linked dirhams, it’s tricky to decide what to do, with some expats continuing to invest in UK property despite the uncertainty. Many believe both property prices and returns in cities such as Manchester and Southampton are still worth the risk. Especially popular are student properties, as there’s a constant supply of tenants. Some UK expats working in the region are simply sending money back to their British accounts, allowing it to build up before taking the buy to let plunge.

Monthly transfers are favourites, using online currency transfer services as and when the exchange rate swings in the investor’s favour. Should the UK crash out of the EU without a deal, the pound is expected to strengthen, tempting more Brit expats in the emirates to take a chance. Alternatively, should a Brexit deal be struck, expat investors will begin looking at European property.

At present, Brexit fears are growing in spite of the House of Lords’ opposition to the idea, with sterling falling as a result. The Bank of England’s earlier hint of a rate rise is now not on the table, GDP growth isn’t giving any good news and the fear of inflation is stalking the creaking halls of Westminster. However, trading platforms in Dubai consider sterling’s down but not out, and are linking the GDP reading with the ‘Beast from the East’ massive storm which held back construction for weeks. It’s now anyone’s guess where it goes from here.