You can’t escape the back-to-school vibe this week. It’s everywhere you turn. Transport is busier. Weather forecasters are warning of chilly nights. It’s even influencing shopping habits.
Sales of children’s clothes and computers propped up retail sales in August, according to KPMG and the British Retail Consortium. Stationery, though, failed to pick up: a different indicator perhaps of how sizeably digital – in this case born of children putting down their pencils and picking up keyboards – is impacting the high street.
And, as in any classroom, not everyone is confident about the tests that the school year ahead will bring.
There was a modest rise in net lending to property in July, but this was driven by an increase in lending to existing property. As Capital Economics notes: “Net lending for new development has been negative for the past three months.” Bankers, clearly, are wondering how they will cope with the questions set.
Meanwhile, August data from the Chartered Institute of Purchasing and Supply pointed to a renewed slowdown in output growth across the UK construction sector. That said, the institute’s polling suggests construction firms are optimistic that business activity will expand over the coming 12 months. That degree of confidence may be at its weakest since May, but builders seem a little more confident that they can stay on top of their coursework.
Some haven’t spent all summer playing Fortnite; they’ve been hard at work, readying themselves for the new term. Those keen researchers from GVA, CBRE and Knight Frank are in this group. Any teacher who reads their summer projects would be minded to congratulate them on a coherent narrative: stronger occupier demand in central London and big regional cities than in the South East, though reduced supply should insure against sharp rises in vacancy rates.
It’s only days into the new term but already Berkeley, always one of the cleverest in the class, is worrying that others will hold it back: “In essence, this is a market that lacks urgency and London remains constrained by high transaction costs, restrictive income, multiple limits on mortgage borrowing and prevailing economic uncertainty, accentuated by Brexit.”
It’s going to be a busy term, though Christmas will be here soon enough. As in schools up and down the country, so in real estate: there’s a collective, dawning realisation that the only way to get there unscathed is through hard work. There’s no room for coasters in this classroom.
■ EG is here to help, through the weekly magazine, Radius Data Exchange and with a series of study guides over the coming weeks. Our investor guides return, focused on London, UK Cities and Global. The next edition of our Tech magazine will be out later this month, as well as a Retail & Leisure supplement.
There’s no shortage of after-school clubs either. The Question Time roadshow is rolling into Manchester, Dublin and Glasgow, and we’ll be hosting stands at Expo Real in Munich and MIPIM UK. Our next global investor tour takes in the Middle East.Conferences include the diversity-themed Not Just Another Property Event, the Future of London at Printworks in Canada Water and Tech Live in Manchester. And in this climate you can’t afford to miss the spectacular line-up of speakers on stage at our Finance and Asset Management conference.
Find out more on each of these here.
To send feedback, e-mail damian.wild@egi.co.uk or tweet @DamianWild or @estatesgazette
