UK Commercial Property

IHS Markit/CIPS Construction PMI (Sep.)

The further drop in the construction PMI in September suggested that the recovery in construction has faltered amid a severe lack of materials and staff, spiralling costs, and softening demand.
Andrew Wishart Property Economist
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UK Commercial Property Chart Book

Rental growth hits a three-year high

Commercial property’s recent good run continued in October. The annual rate of rental growth surged ahead after only breaching positive territory for the first time in almost two years during August. However, given the economy’s headwinds over the near term, we suspect that property markets will struggle to maintain their current pace. Once this year’s rebound passes, we expect total returns to soften over the forecast period, as yields stabilise and structural changes within retail and offices weigh on rental growth.

3 December 2021

UK Commercial Property Data Response

Lending to commercial property (Oct.)

A drop in repayments and rise in development activity resulted in positive net lending in October for the first time since March. Despite this turnaround, credit conditions will remain tight and uncertainty about the recovery will continue to weigh on lending in the near term.

29 November 2021

UK Commercial Property Data Response

IPF Consensus Forecasts (Nov.)

The resilience of the commercial property market has led to further upgrades to the IPF Consensus view for this year, albeit still below our forecast. Beyond this year, we are more downbeat about the outlook than the consensus given our expectation that work-from-home will have a more lasting impact on offices.

26 November 2021

More from Andrew Wishart

UK Housing Market Update

Modest rate hikes won’t prevent house price gains

We doubt that a larger rise in Bank Rate over the next two years than we previously expected will put much upward pressure on mortgage rates. Low interest rates and increased spending on housing costs will continue to provide a supportive environment for house price valuations. So we retain our above-consensus view that house prices will rise by a further 5% in 2022.

1 October 2021

UK Housing Market Data Response

Nationwide House Prices (Sep.)

The only small gain in house prices in September suggests that house price growth slowed as the stamp duty holiday was withdrawn. But with inventory limited and demand resilient, we suspect that house price growth will cool gradually rather than collapse.

30 September 2021

UK Housing Market Data Response

Mortgage Lending (Aug.)

While still above pre-COVID-19 levels mortgage approvals edged down in August, suggesting no great rush to move before the stamp duty holiday taper ends at the end of September. But an increase in the size of mortgages approved indicates that the end of the tax break may only be a small drag on demand.

29 September 2021
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