There has perhaps been no better time in the last eight years to take personal ownership of your future in the real estate market and drive your career forward. Here’s why: the UK has a political climate which is seen globally as ‘pro-business’, in a country that is considered to be ‘open for business’. The UK economy is in the best shape that it has been in for almost a decade and with many positive indicators for the future, over the short-, medium- and long-term.
As the fastest growing advanced economy of the G7 in 2014, many economists are confident that the UK will overtake France as the second largest economy in the EU this year; and many expect the UK to be the largest economy in the EU within the next two decades. The net result of this is that in the last four years, the UK has created more jobs than the whole of the EU combined and yet it was recently reported that the total number of unfilled vacancies in the UK sits at around 700,000. The voracious appetite for skills of the expanding UK economy far outstrips the supply and this feature of the market is particularly pertinent within the real estate market.
Why real estate?
As an investment class, commercial real estate continues to outperform its rivals. According to Savills' ‘‘Market in Minutes July 2015" report, the average total return on UK commercial property remains at 18.63% to the end of February Q1 in 2015, in stark contrast to oil, copper and gold, which offer returns of -42.57%, -16.4% and -8.9% respectively. Savills predicts that ‘due to the strong level of demand property should continue to outperform many other asset classes this year.’ To complement this, the UK has presided over a prolonged period of record low interest rates and whilst many expect the Bank of England to raise rates in 2016, we are likely to remain in a ‘low interest rate’ landscape for some time to come.
As highlighted above, there are record levels of investment into UK commercial real estate - £16.8billion in Q2, 2015 an 8% increase on the year before and of this £6.5billion was foreign investment, a 44% increase on 2014. This investment is not limited to London and the South East. The North East saw £308million invested in Q2, 131% above the five year quarterly average.
Acute skills shortages drives remuneration
There is a direct and positive correlation between inward investment, supply side economic growth and the demand for skills, so consequently in the real estate sector, we are witnessing one of the most acute skills shortages that we’ve seen in a decade. This supply shortage within the candidate market, inevitably drives levels of remuneration upwards as seen above from the average uplift of salaries of those securing new positions by 15%. But there is a flipside to this trend - those candidates who have remained in the same job for a long period of time are now falling behind the marked growth in the levels of remuneration that we have seen.
We haven’t surveyed job satisfaction within the real estate market and of course that has a "value" to individuals which is not accounted for here. But looking at the raw figures in our infographic there are clear conclusions to be drawn. If you are a property professional then this is an employment market for you. The growing economy, inward investment and skills shortage all present you with the best opportunity in many years to further your career. As shown above, if you have the right blend of real estate and analytical skills, then you are particularly attractive to employers.
At Cobalt, we can provide you with unprecedented access to the real estate market and in particular access to many clients in the market, that are often less visible to candidates or operate very discretely when it comes to recruitment. Contact one of our Consultants for a confidential conversation about how we can assist you in developing your skills and in driving your career forward.
Let us know your thoughts in the comments box below or feel free to share via the social buttons below.