Economic and property market review

Our latest view on the outlook for the UK economy and commercial property market.

Type Research

Date 02/11/2018

Political rather than economic events continue to dominate the outlook and with no known significant progress on negotiations between the UK and EU, the risk of a no-deal Brexit still lingers.

Improved forecasts for growth and tax receipts by the Office for Budget Responsibility (OBR) allowed the Chancellor to deliver a Budget with more giveaways than expected.

All-property average rental growth has significantly slowed since Q1 2018 amid a subdued economic environment (see middle chart). In the 12 months to September, all-property rental growth slowed to 1.4%, down from 1.6% in August (IPD Monthly Index).

The UK commercial property market will remain attractive with the exception of retail. The global weight of money against a limited supply will keep yields low for many assets.