Public sector cuts pose the biggest threat to commercial and residential property markets according to Knight Frank’s market outlook breakfast at its London headquarters.
The breakfast, hosted by Knight Frank’s valuations and research teams and attended by banking clients responsible for property funding, included an eight question survey which encouraged the floor to vote on topical commercial and residential property market questions. Knight Frank’s heads of residential and commercial research presented their property forecasts and provided market overviews.
63% were most concerned by employment prospects regarding the outlook for the housing market, while the feeling that the volume of bank lending to the residential property sector would either remain unchanged or rise marginally over the next year was felt by the majority of the audience.
The overall majority of voters thought that the base rate in July 2011 would be between 0.5 and 2%, with a very small minority thinking it will go above 2%.
38.7% of the audience believed that house prices in the UK will rise by between 0% and 5% over the next 12 months and 24.2% felt that there would be no change in house prices during this period.
Liam Bailey, head of residential research at Knight Frank, said: “The obvious headline from the budget was the seriousness of intent of the government to deal with government debt. To me the implication from this is the resulting huge requirement on the private sector to fill the gap left by the state.
