The uncertainty hanging over the UK economy since the 2016 EU Referendum should now gradually subside following the Conservatives’ majority win in the General Election.
With a parliamentary majority, the Prime Minister’s deal with the EU is expected to pass and the Article 50 process will end on the 31st January 2020. The nature of the future relationship between the UK and EU will be a key feature of 2020 but there will at least be a greater degree of certainty for business.
The pound has shown signs of strengthening following the election result, while the economic fundamentals such as employment and real wage growth will help to underpin confidence. The greater certainty in the outlook – for households, businesses and housebuilders – should in turn lead to notable increases in house prices, housing transactions and housing starts across all regions of the UK. There is also expected to be an uptick in investment activity in the student and multifamily sectors.
Against this political backdrop JLL has identified the fundamental certainties which will shape housing delivery in the coming years. These certainties sit alongside our positive housing market forecasts for the next five years.
- Housing will remain a key item on the political agenda:
- The focus will remain on supporting first time buyers. Help to Buy will remain in place until at least 2023.
- Pressure will continue to deliver more Affordable Housing with 1.1m people on the current social housing waiting list.
- Parents are having children later in life which is delaying the desire to purchase family-sized homes and supporting the growth of renting,
- People are living longer creating the need to deliver more elderly-appropriate housing – some 25% of the UK population will be over 65 by 2030.
- There will be an additional 2.5m people living in UK’s urban areas by 2024,
- The need to densify housing and provide flexible and shared living spaces is fuelling the rise of alternative sectors such as coliving.
- London is ranked by JLL’s Cities Research team among the seven established world cities,
- The UK Capital is particularly strong for its growth in digital sectors and its ability to nurture talent – there are more high-ranking universities in London than any other city in the world.
- 25% of Britons no have multiple smart devices in their home.
- The thirst for technology will continue to grow meaning homes will continue to accommodate ever more automated devices.
- Fundamental population changes will occur:
- Towns and cities will see the highest housing demand:
- London will remain at the world’s top table:
- There will be ever more connection between living and technology
- Climate and social awareness will continue to accelerate:
- All new homes will need to be Net Zero Carbon by 2030
Developers will adapt housing delivery to meeting growing demands around economic, environmental and social impact.
