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Cancel All Late October Leave, Because This Is When Birmingham's Property Market Future Will Be Decided

Chancellor of the Exchequer Rishi Sunak

The last two weeks of October and the first weeks of November will be crunch time for Midlands property.

A range of macro-economic events and micro-economic data will set the tone for the region’s recovery, and serious players had better be on hand to deal with it.

That is the message from one of the property industry’s most respected economic analysts.

Colliers International Chief Economist Walter Boettcher told Bisnow that the future of regional development plans, including the stimulus planned around the arrival of HS2 and the Hub scheme at Birmingham International, will determine what comes next in post-pandemic recovery.

The claims come as Rishi Sunak, the chancellor of the exchequer, is reported to be considering postponing his October spending statement, a move Boettcher said was worrying.

“I wouldn’t book holidays late October or early November, there’s going to be too much happening,” Boettcher said.

“In the property market we will begin to get reliable transactional evidence on values, and also on the volumes of investment. I expect prime yields to remain firm, London is still good value at a 4% yield compared to 3% in Paris, but the crucial numbers will be the volume of overseas investment because cross-border money is going to be sustaining the UK property market. The evidence so far is that overseas investors are still in the market, but this is the data set to watch.”

Simultaneously Boettcher pointed to larger-scale national risks.

“We haven’t seen the full economic fallout of the pandemic, and it will come in October and November as the furlough scheme unwinds, the Bank of England responds, and the Chancellor announces his autumn spending review. If Rishi Sunak is thinking of postponing that, then it concerns me a lot,” Boettcher said.

“The autumn statement has huge implications for regional investment. It matters because we’ve a lot of local regeneration plans — the HS2 plans and the 340-acre scheme at Arden Cross are classic examples — and until domestic investors get a clear indication of where the UK government plans to invest and the scope and scale of that investment, they will not start to pile in,” Boettcher warned.

“To delay the autumn statement would be to lose an opportune time to get the money moving. Boris Johnson keeps saying ‘build, build, build’ so I hope they would be reluctant to postpone but we will have to see what the fallout from ending furlough looks like,” Boettcher said, referring to a Financial Times report that economic problems caused by the end of the furlough scheme might cause the autumn statement to be shelved.

“As if the period won’t be busy enough, immediately after the autumn statement we get the result of the U.S. presidential election, which will really set the tone.”