There is now an increasing risk of a no deal exit. This would have three main implications for the development:
● Interest rates - in view of the impact on the economy, interest rates are likely to be held lower for a longer time than currently assumed in the MHOS business plan which will reduce the amount of interest payments.
● Disposable income – recent falls in the value of the pound have started to factor in a no deal exit which will increase the costs of goods from abroad. World trade arrangements could add to these increased costs especially for food. The Government has already indicated that it would consider reducing this impact by having zero tariffs on some food imports. Lower interest rates would mitigate the impact of lower disposable income.
● Security of employment – the York economy is mainly service based and therefore will not experience the impact of a no deal Brexit where there is a greater base of manufacturing industries and jobs with substantial supplier chains with the EU. York has a significant tourism industry which benefits from the fall in the pound.