CBRE’s latest housing forecast has found that the UK residential market is entering a sustainable growth phase, with a lower level of transactions and price growth likely. Tighter mortgage regulation, coupled with wider affordability issues, with prospective interest rate rises, will lead to a slowdown in the growth of house prices across the UK. However, this will be counteracted by solid economic growth and the boost from recent Stamp Duty changes. Underlying price growth will continue to be driven by a basic lack of supply, coupled with continuing strong domestic demand. Over five years CBRE forecasts that national house prices will grow by 25%, with the London market continuing to lead the way. For 2015 CBRE is forecasting 6% national house price growth.
This report sets out CBRE’s view on property market prospects for 2015. After a strong year in which total returns to property averaged nearly 20%, 2015 promises to herald the start of a gentle return to more sustainable growth rates across most sectors. CBRE forecasts total returns to property of just under 13% in 2015. General election uncertainty is thought by many to be a significant factor for 2015 in the minds of property market decision makers – an issue CBRE Research will explore further in the coming months. We predict more significant rental growth for most sectors in 2015 than in 2014; and we think there is potential for further falls in yields given the relative attractiveness of property investment and the weight of money entering the UK market. Prime London markets will continue to grow in 2015, but confidence and investor interest is now returning to prime regional markets; and we also expect secondary markets to fare better than in recent years – in all cases characterised by a lack of a good quality new supply. Prospects for retail properties remain among the most uncertain, with few sure signs just yet that stable growth is returning to consumer spending, and cost pressures and distractions across the sector, particularly in grocery retailing – though again, prime retail destinations will remain a safe bet. Industrial property has performed very well and a dearth of supply means we predict that this will continue to look like an attractive sector; Price growth in the housing market looks likely to ease somewhat in 2015 – we predict price growth of around 6% in 2015; we think transaction levels have peaked for the time being.
Our latest research looks at the winners of London's residential market and takes an in-depth look at the economic and housing market trends of the past year. CBRE Top 10: - Best performing boroughs - Niche and boutique schemes - Most affordable boroughs to buy - Areas where demand is not matched by supply - Ten towers that raise our expectations - Tallest towers - Highest share of private rental households - Areas with highest expected rental growth - Commuter towns - Ten developers to watch - Bonus ball top tens
UK COMMERCIAL REAL ESTATE SET TO DELIVER TOTAL RETURNS OF OVER 19% IN 2014 Total returns for All Property were 1.4% in October, driven by capital value growth of 1.0% over the month. So far this year capital values have increased by 11.6% and resulted in total return of 17.8% for the last eleven months All market segments have recorded higher total returns so far in 2014 than in the whole of 2013. For some time we have expected that rental growth would take over as the main driver of capital value growth in Central London offices. Although yield shift is still an important component, it is notable that the contribution from rents is becoming bigger.
Welcome to the third edition of IN_business, where experts from the CBRE National Team will guide you through key issues and trends for UK Real Estate. The Autumn edition includes CBRE’s viewpoint on investment and interest rates, the property wish list for Generation Y and Creative occupiers, and in an extract from our 'The UK is Building' report, we compare availability, occupier costs and rents in nine key regional offices markets. We also explore the property implications of increased regional autonomy following the Scottish referendum and provide an update on how institutional investment is progressing within the PRS market.