High-net worth individuals (HNWIs) in the UK are facing post-Brexit reality, which is expected to bring different short-term and long-term consequences, according to a UK wealth management firm.
WealthInsight said Brexit made many HNWIs poorer in the short-term as billions had been wiped off markets which directly hurt their pockets.
On top of that, many foreign born HNWIs (non-doms) were thrown into uncertainty as Brexit delayed the announcement of the new rules.
Additionally, there were visible signs that luxury spending was declining, which according to WealthInsight, was a ‘recessionary behaviour', also observed in 2008.
On the other hand, it led to an increase in the art, wine and precious stone markets, with gold already rising.
On a positive note, weaker sterling was expected to help UK exporters which meant that HNWIs in manufacturing could expect prosperity while a weak currency would also drive up London's central-prime real estate market.
As far as the long-term implications were concerned, HNWIs were expected to benefit from lighter regulation which would apply not only to the financial sectors but would also include SMEs and other non-financial industries, from fisheries to farming.
Head of WealthInsight, Oliver Williams, also noted that in the long run, Brexit would change the UK's private banking sector, which was combatting over-regulation and fintech disruption.
"In the immediate future, private banking will come into its own as proper financial planning and risk management are required to mitigate current market volatility,"
"Long-term, the UK's private banking industry may appeal to overseas HNWIs as the UK sets its own rules on laws affecting HNWIs, such as anti-avoidance tax legislation," he said.
Williams also stressed that in general it was anticipated that "Brussel's laws are replaced with Westminister's", and that HNWIs would continue to come to London lured by its quality of life combined with strong judicial system and that London would remain its place in rankings.