Brexit uncertainty a factor for UAE residents planning UK return
The uncertainty has led to some postponing plans to move back to the UK, while others see a financial opportunity both ways with the favourable dirham to pound exchange rate
French national Sandra Pavlowsky had lived in London for 12 years and her French-Italian husband Alexandre Darre for 18 years before they moved to Dubai to “try something new” in 2012. Like many expats, they planned to stay in the UAE for five to six years before returning to the UK for their daughter Sasha, now 14, to finish her schooling there.
Then the Brexit referendum in June 2016 — when a majority voted to leave the European Union — changed everything for them. As EU nationals, the uncertainty of how the laws will be amended in terms of visas and doing business in the UK has led Ms Pavlowsky and Mr Darre, both 48, to postpone their plans.
“Our daughter is more likely to start GCSE (General Certificate of Secondary Education) in Dubai, rather than being back in the UK as we planned, because we still don’t know — and nobody knows,” says Ms Pavlowsky, the founder and managing director of a financial consultancy company.
Brexit has not only been a factor in the plans of European expats living in the UAE, but also British expats. Some have chosen to stay longer to benefit from higher savings with the favourable dirham to pound exchange rate. Others returning to the UK will see their savings go further, but face an uncertain future when considering buying property there.
In the case of Ms Pavlowsky and Mr Darre, who is a hedge fund manager, working in the financial sector poses particular challenges. Distributing asset management products in Europe while based in the UK may not be feasible if the country is “not part of the European financial world any more,” says Ms Pavlowsky.
“Brexit is putting on the table the big question mark. You can see that a lot of financial institutions already left London to go either to Europe or Asia,” she adds.
In addition, it is unclear how they would be affected by any changes in taxation, residency and visa laws.
“You cannot plan your life when you have no insight into what the law is going to be for you,” Ms Pavlowsky says. “It’s OK if you’re single and 20, if you’re retired … but we have a daughter, we have school, we have a business. The risk is too high.”
Tom Sindall, a corporate security manager, and his wife, Anna, a schoolteacher, also moved to Dubai pre-Brexit in 2015. The plan was to stay for a “definite two years,” but they have since decided to stay longer after the Brexit vote resulted in a drop in the pound’s value.
“It benefited us because earning in a different currency has meant a better exchange rate, so it’s essentially a pay raise for the same job,” says Mr Sindall, 36. “We’re staying here because we’re in a different position now.”
In 2010, the Sindalls had bought a property in their home town of Southampton and another one in Pourtsmouth nearby. After Brexit, as house prices dropped, they decided to purchase a “cheap property” in 2018 in Accrington, north of Manchester. All three properties are being rented out with the intention to save up for the future and eventually put money into purchasing a long-term family home when they do return.
“It doesn’t really matter if the house prices drop because they’re all long-term investments anyway,” says Mr Sindall.
With a 15-month-old daughter and another child on the way, they have chosen the financial security of having stable jobs and medical care, along with the ability to save more. “Financially, having children, we are better off here,” Mr Sindall explains.
Mandy Summers, 59, and her husband Colin, 63, are returning to the UK in June after 31 years of living in Dubai.
“We are reaching retirement age and it’s also a good time in the girls' education for us to move,” says Ms Summers, who has a a 16-year-old who will have two years left in secondary education and a 17-year-old already in boarding school in the UK.
Ms Summers is working as a speech and language therapist, while her husband is already retired. Investing in property in the UAE, including the purchase of three houses in Arabian Ranches throughout the years, has also helped them earn money. They owned their latest property for 12 years and although real estate values have declined in Dubai, the lower pound to dirham exchange rate means transferring their savings to pounds has been advantageous.
“When we sold our house here, we got far more pounds for our dirhams,” says Ms Summers.
As for purchasing property in the UK, they are taking a wait-and-see approach for now as the March 29 deadline to leave the EU looms.
“We’re waiting to buy,” Ms Summers says. “We’ll possibly see more reductions — really depending on which way Brexit goes and whether there are more properties coming on to the market — people are definitely waiting to see what happens.”
Updated: March 5, 2019 11:33 AM