Property leaders warn of Brexit impact in UK economy and real estate in 2019
The proportion of property industry leaders intending to increase development activity in 2019 has fallen by over a third according to a survey of the UK’s largest investors, owners, developers and advisors who are members of the British Property Federation.
In 2017, 62% of the survey’s respondents said that they planned to increase development activity in 2018. For 2019, this has fallen to 41%.
Data from the latest polling conducted by the BPF and Grosvenor Britain & Ireland, shows that 91% believe leaving the European Union will be worse for Britain’s economy over the next 12 months, and only 41% believe it will be better for Britain’s economy over the next 10 to 20 years.
Confidence in UK real estate’s performance over the next 12 months has also fallen, with only a quarter (24%) saying they feel confident about 2019. This compares to last year’s results where nearly half (48%) felt confident about the industry’s performance in 2018.
However over half (55%) are confident in the industry’s performance over the next five years, up from 48% a year ago.
Over a third (36%) believe the industrial sector will perform best in terms of financial return in the next 12 months, with 17% saying the same about residential. None of the property leaders surveyed felt the retail sector would perform best in the coming year.
The majority of respondents did not believe public trust in the UK’s planning system (85%) or real estate industry (75%) is ’strong’. Almost half (47%) felt that the sector is not changing quickly enough to increase social mobility by being more inclusive or diverse, although 30% said the industry is changing quickly enough.
BPF chief executive Melanie Leech said: “The real estate industry underpins UK productivity, and economic and social wellbeing, by delivering the physical fabric where we all live, work and relax, and so these results should be taken seriously by politicians. They send a clear warning that development activity is at risk, and this will undermine the country’s ability to deliver the high-quality homes, offices and leisure spaces that inspire innovation and regeneration to ensure our town and city centres can thrive.”