UK General Election Results Impact London Property Markets
On the heels of a failed snap election in an effort to build a bigger majority and a personal mandate Theresa May the British Prime Minister now faces the though job of trying to forge a coalition deal to stay in power.
2017/06/29
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On the heels of a failed snap election in an effort to build a bigger majority and a personal mandate| Theresa May| the British Prime Minister| now faces the though job of trying to forge a coalition deal to stay in power.
In reference to how the UK General Election results now impact Londons property markets| Chris Ireland| CEO of JLL UK tells The World Property Journal| "The UK has faced political uncertainty in very recent history and| notwithstanding the dramas that immediately followed the Brexit vote| the UK economy and property market remained very resilient. The IPD benchmarking index has regained almost all of the losses it sustained in August over the past few months.
Investors in real estate look over the medium to long term. London sees by far the most cross-border investment of any city globally| and the UK is rated by JLL as the most transparent real estate market in the world. This is a result of liquidity| the history of political stability over the long term and respect for the law| as well as factors such as the strong economic fundamentals| long lease terms and the comprehensive professional and legal framework.
"The result suggests that the hard Brexit that many were assuming would now definitely occur looks somewhat less likely. That could be a longer term positive for the UK market.
"Sectors with long-term structural support| such as Logistics and Alternatives| will remain strong. If the pound remains weak| Retail and Hotels will benefit - alongside UK manufacturing. But as before| JLL continues to believe the UK offers significant opportunities for medium and long term investors."
On the loss of Housing Minister Gavin Barwells seat| Jon Neale| Head of Research of JLL UK further added| "With Gavin Barwells departure from Parliament| we are now facing the prospect of yet another Minister for Housing| the fourth in five years.
"Given the huge role that a high youth turnout has had in changing the political landscape| it must now surely be time for all parties to prioritize an issue that has had more negative impacts on young people than any other| and increasingly erodes the competitiveness of the British economy.
"The next housing minister must be an experienced and hard hitting political figure| and the role must be inside the cabinet. They must help develop a genuinely radical housing policy. Indeed| this should be seen as an electoral priority by all parties if the young continue to become more active at the ballot box."
Miles Gibson| Head of UK Research at CBRE also commented| "While the Government might look weakened in the light of todays result| the overall shape of Brexit isnt obviously changed by it| nor are the UKs strong economic fundamentals - which underpin its commercial real estate market.
Inevitable heightened uncertainty while the political landscape stabilises| may cause the market to be slightly cautious in the very short term. However| most will see through this uncertainty and focus on the fundamentals| implying that the current transactional activity will be largely unaffected.
The decision to hold the general election at all comes with the benefit of a two-year extension to the PMs political capital. For trading businesses in the UK| particularly financial services businesses| this extra time will help them plan for the consequences of Brexit.
This uncertain outcome also means that not much other than Brexit will occupy Ministers minds for some time| implying a welcome (if unintended) stability on real estate policy. Some of the more ambitious or expensive policies look likely to stay on the back burner purely because of a lack of capacity to implement them."
source : worldpropertyjournal.com
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According to speakers at the National Associations of Realtors recent international real estate forum in Washington D.C.| housing markets across the U.S. are increasingly becoming international| and changing demographics brought forth by immigration and growing interest from foreigners are positioned to bolster home sales activity and prices.NARs Danielle Hale| managing director of housing research| was joined by Alex Nowrasteh| immigration policy analyst at the Center for Global Liberty and Prosperity at the Cato Institute| to share insight on the current and future impact of foreign buyers and immigration on the U.S. housing market. U.S. Foriegn Buyer Market Highlights for 2016 Include:- Foreign buyers purchased $102.6 billion of residential property from April 2015-March 2016| a decrease from $103.9 billion in the previous 12-month period.
- Foreign buyers purchased 214|885 residential properties| an approximately three percent increase from 208|947 in the previous 12-month period.
- Foreign buyers typically purchase more expensive properties.
- Although foreigners purchased property nationwide| five states accounted for 51 percent of total residential property purchases: Florida (22 percent)| California (15 percent)| Texas (10 percent)| Arizona (four percent)| and New York (four percent).
According to Nowrasteh| the rising U.S. population is being bolstered by a growing number of immigrant households| and their presence will continue to transform the housing market. Referring to data from the 2015 American Community Survey| Nowrasteh said of the roughly 321.4 million residents in the U.S.| 278.1 million are born here (natives) and the remaining 43.3 million - made up of 20.7 million naturalized citizens and 22.6 million non-citizens - are foreign-born. "Immigration affects rents and home prices far more than it affects the labor market|" said Nowrasteh. "An expected 1 percent increase in a citys population produces a 1 percent uptick in rents| while an unexpected increase results in a 3.75 percent rise."Nowrasteh| pointing to studies conducted on immigration and housing| explained that the effects of immigration on real estate are localized| with most of the impact felt where immigrants tend to reside: low-to-middle income counties. Each immigrant adds 11.6 cents to housing value within that county. In 2012| 40 million immigrants added roughly $3.7 trillion to U.S. housing wealth.Referencing the Legal Arizona Workers Act that went into effect on January 1| 2008| Nowrasteh said the decline in population resulting from the law likely exasperated the drop in home prices the state experienced during the downturn. Fewer households purchasing or renting property subsequently lead to higher vacancies and lower prices. "Immigration is the best way to increase population| housing supply and prices|" he said.Presenting some of the key findings from NARs 2016 Profile of International Activity in U.S. Residential Real Estate released last July| Hale said foreigners increasingly view the U.S. as a great place to buy and invest in real estate. She noted the upward trend in sales activity from resident and non-resident foreign buyers in the past seven years| with total foreign buyer transactions increasing from $65.9 billion in 2010 to $102.6 billion in the latest survey."A majority of foreign buyers in recent years are coming from China| which surpassed Canada as the top country by dollar volume of sales in 2013 and total sales 2015|" said Hale. "Foreign buyers on average purchase more expensive homes than U.S. residents and are more likely to pay in cash."Perhaps foreshadowing where a bulk of future home purchases from immigrants will come from| Hale said that in NARs latest survey roughly over half of all foreign buyers purchased property in Florida (22 percent)| California (15 percent)| Texas (10 percent)| Arizona or New York (each at 4 percent).Latin Americans| Europeans and Canadians - who tend to buy for vacation purposes in warm climates - mostly sought properties in Florida and Arizona. Asian buyers were most attracted to California and New York| while Texas mostly saw sales activity from Latin American| Caribbean and Asian buyers.
Global Retail Construction Rises China and Mexico Lead the Way
According to a new report from CBRE Group Inc. developers completed more retail centers across the globe last year than in 2015 but momentum appeared to wane in many countries as retailers strive to find the right balance of brick and mortar and e-commerce operations.
2017/06/29
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According to a new report from CBRE Group| Inc.| developers completed more retail centers across the globe last year than in 2015| but momentum appeared to wane in many countries as retailers strive to find the right balance of brick and mortar and e-commerce operations."In the omnichannel era| retailers are focused on ensuring that they have the optimal mix of brick-and-mortar stores and e-commerce operations| so they are using sophisticated analytics and market knowledge to choose the best store sites rather than the most store sites|" said Anthony Buono| Chairman of CBREs Global Retail utive Committee. "At the same time| an easing of construction volumes likely will benefit retail-center owners by supporting rental rates."CBREs annual study of global retail construction found that builders completed 134.5 million sq. ft. (12.5 million square meters) of shopping centers globally last year| up 11.4 percent from 2015. Seven of the top 10 markets for retail completions are in China| with Mexico City| Moscow and Melbourne rounding out the top 10.Meanwhile| construction activity has slowed in many markets. The global pipeline of retail centers under construction declined by 22 percent to 360.6 million sq. ft. (33.5 million square meters) at the end of last year in comparison to a year earlier| according to the CBRE report.Retail completions in the Americas jumped by nearly 44 percent last year| due mostly to a surge in construction in Mexico. An economic lift from Mexicos thriving automobile-manufacturing industry helped spur developers to complete 14 million sq. ft. (1.3 million square meters) of retail centers in three major Mexican cities last year. In the U.S.| markets delivering the most new supply last year included Houston| New York City and Honolulu.The Asia-Pacific region (APAC) - and China| in particular - remains the global hotspot for retail construction. More than 90 percent of APAC cities studied by CBRE hosted large-scale retail construction in 2016 compared to 56 percent of cities in the Americas and 14 percent in Europe| the Middle East and Africa (EMEA). Of retail construction completed in 2016| APAC accounted for two thirds.However| even APAC and China appear to be taking a breather. The APAC pipeline of retail centers under construction was down 24 percent at the end of 2016 from a year earlier. Chinas completion of nearly 62 million sq. ft. (5.75 square meters) of retail centers last year was down slightly from the previous year| and half of Chinese malls that opened last year delayed their debuts by at least six months due to sluggish leasing progress."The Chinese retail market is showing some signs of recovery. There are short term oversupply concerns in some markets and submarkets| although others remain buoyant|" said Joel Stephen| CBRE Senior Director| Advisory & Transactions| Retail Asia. "Retail markets are thriving across APAC| with strong demand supporting construction in markets like Melbourne| Brisbane| Kuala Lumpur and Ho Chi Minh City."Retail construction in EMEA was relatively calm| increasing by 18 percent last year but still trailing APAC and the Americas. Big retail centers came online in Moscow| South Africa and Kyiv in the Ukraine.