Comment on inflation rising to 3.3%
Industry reaction to inflation rising to 3.3%
Daniel Austin, CEO and co-founder at ASK Partners, said:
“Today’s uptick in UK inflation will raise fresh concerns across the property market, which is still waiting for the full economic impact of the Iran conflict to feed through. Households, buyers and developers recognise that current data is unlikely to reflect the secondary effects of the war, which are expected to place further upward pressure on prices. The UK mortgage market is already showing signs of strain, with nearly 1,000 products withdrawn since the conflict began.
“Investment activity is therefore likely to remain concentrated in structurally resilient, income-driven segments such as build-to-rent, co-living, logistics, self-storage and data centres, where chronic undersupply continues to underpin demand.
“A sustained and credible downward path for inflation, now looking increasingly unlikely, remains the key catalyst for unlocking stalled development. The Bank of England’s decision to hold rates underscores the uncertainty surrounding the inflation outlook, particularly amid ongoing geopolitical pressures. Until greater clarity emerges, both developers and investors are expected to remain defensive, with capital favouring disciplined, income-focused strategies. In this environment, real estate debt continues to offer a pragmatic route to deployment while helping to mitigate downside risk.”
Nathan Emerson, CEO of Propertymark, comments:
“Today’s news will be a disappointing yet widely anticipated outcome for many consumers. However, until inflation is reduced to more sustainable levels, it will have a wider impact on the UK’s housing market.
“With governments across all nations pursuing ambitious housing targets, there will be a keenness to ensure inflation is kept as low as possible to empower future investment in accommodation and that it can deliver consumer value.
“At this point, it’s important not to be pessimistic, nor overconfident; instead, we must be finely tuned to being genuinely realistic. The housing sector is a key indicator of wider financial health and an extremely important sector to see survive and thrive, but there are important considerations ahead.”
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