The real estate sector is collectively upbeat for the next year but remains guarded beyond that. Indeed, while 88% of respondents to a survey carried out by the British Property Federation (BPF) said they were confident the market could bloom for the next 12 months, their confidence was less certain going into 2017 and beyond. More than half of those surveyed said that 2016 would be a year where development activity would rise but 46% noted concerns as we move into 2017.
The surveyed has highlighted barriers to development, namely developable land being made available in London. Respondents encouraged local government to do more to help the property sector grow while calls in London for the assembly and sale of developable land continued. Investment was encouraged in the blossoming “build to rent” market (a sector which allows developers to keep ownership of those houses newly built).
London remains, unsurprisingly, the favoured location for planned investment. 53% said their business plans to grow investment levels while 23% planned to maintain levels over the next year. Elsewhere, in the Midlands for example, 60% expect to add to their investment portfolio while 23% would keep levels the same. The North West of England saw respondents less eager to increase investment with only 25% saying they would do so. It was even lower in Scotland with just 16% revealing they would be happy to increase investment.
BPF chief executive Melanie Leech acknowledged the important contribution the real estate sector makes to the UK economy and said it was crucial that it remains buoyant because of what it can do for “regeneration” and “growth” across the country. The positivity across the sector was therefore “welcome”.
She said there was a number of things that can be done to see that positivity continue into 2017 and beyond. While she admitted some things are out of their hands, the government should set out a clear mandate to “assemble and sell” public sector land. She also noted her enthusiasm at data revealing that investment and a positive outlook was not solely based in the capital city but across the UK.