Real estate set to outperform wider economy

The real estate sector is expected to be one of the top performing sectors for growth and employment as the country recovers from the Covid-19 pandemic, according to EY’s latest Regional Economic Forecast.  Employment in real estate is forecast to grow by 1.39% by 2023 – the highest of all sectors. The next best performing sectors for employment growth are the public sector (0.78%) and health (0.75%). When measured by gross value added, the real estate offices, behind only the health sector (0.92%). The total UK economy is forecast to grow just 0.14% annually.  Russell Gardner, EY’s UK&I head of real estate, hospitality and construction, said: “Many investors will be reimagining what future real estate will need to offer following the significant impact of the pandemic on the way we live and work. There will be growth opportunities for the sector as the country reinvigorates and reinvents our high streets and city centres.”  The picture across the country varies widely, however. EY’s analysis forecasts the largest growth in employment in the South East (excluding London) at 1.85%, followed by the North West (1.81%) and the East Midlands (1.75%).  The regions with the smallest growth in sector employment are the West Midlands (0.77%), Yorkshire and the Humber (0.78%) and the North East (0.81%).  London’s sector employment is forecast to grow by 1.53%. The story is similar when looking at GVA, with the South East real estate sector growing by 1.28%, the North West by 1.25%, and the East Midlands by 1.19%, compared with 0.21% for the West Midlands, 0.23% for Yorkshire and the Humber and 0.26% for the North East. London’s sector growth is forecast at 0.97%. Gardner added: “The forced extended pause in activity during 2020, coupled with the need to reshape and reanimate our towns and cities, will mean that 2021 may well turn out to be a landmark year for the real estate industry in the UK. Our major cities will see the lion’s share of growth and jobs as they rebound and evolve into a new normal.”  To send feedback, e-mail samantha.mcclary@egi.co.uk or tweet @samanthamcclary or @estatesgazette Image © Syaibatul Hamdi/Pixabay