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We’re now into month four after the Brexit referendum.  The leave campaign was looking like it would suffer a defeat at the hands of the stay campaigners, but as we all know, what would come around at 2am the following morning would be the biggest upset in the governments history.

The uncertainty has spooked the market.  A Brexit has not been priced into the market; the political and economic shock waves will be potentially seismic.  Markets hate uncertainty, the result of a Brexit, economists forecast, indicate the once Great British pound could depreciate by between 10 and 15 percent.

Looking at the graphs below you can see that the pricing in an exit was in the plan, however plans don’t always go the way they’re meant to.

Brexit Currency Graph

What affect does that have on the average UK citizen buying a home overseas, say, in South Africa.

In simple terms it is a huge cost, as the cost of buying a home overseas working on a purchase of ZAR 4 million, it would have cost you approximately £186,219.74 based on a rate of £21.48 – a few days before the Brexit vote that was.  The impact of the initial vote gave sterling a drop across the board of about 4%, now that would have been great, but the extent of the long awaited article 50 has led Sterling to drop down nearly 20 percent against the Rand and the worst thing is, this doesn’t look like the end.

What to expect in the long term?

Taxes, ISA’s and Pensions

State pensions and UK Taxes are set by the UK Government so no change is anticipated. ISA’s too, are an exclusively UK product.


Expats who rely on UK income such as pensions will be affected by any currency swings. For example, £1,000 would have bought ZAR 23,000 last December, but is now worth only ZAR 17,000.

The bigger worry for more than a million pensioners living overseas is whether their state pensions will continue to be updated annually.

In summary, if you have overseas assets or you’re looking to purchase overseas in the coming months just don’t speak to your bank about sending funds, speak to as many financial people as you can and as always get a few quotes on the currency as banks will always look to charge private individuals between 3% to 5 %.

For further information on exchange rates and assistance in the transfer of funds you can contact us via our contact page by clicking here.