Inflation Outpaces Home Price Growth
PRESS RELEASE: The UK property market forges ahead seemingly undeterred by economic woes and foreign conflicts, according to Home.co.uk’s Asking Price Index for June.
Demand remains high, even increasing in London and the North East. Stock levels remain very low by historic standards and consequently prices continue to rise rapidly across all regions. The supply of new instructions entering the market nudged up slightly this month as more potential vendors are tempted by record prices.
It is becoming clear that the Bank of England’s paltry efforts to tame inflation are not working. The Bank is expected to continue their impotent strategy and raise the UK benchmark rate by just a quarter point next week to 1.25%, while the purchasing power of sterling collapses. Even by their own preferred measure (CPI), inflation is now 4.5 times their target rate and climbing. Of course, the unprecedentedly large and widening spread between mortgage interest rates and inflation specifically incentivises highly leveraged property purchases.
Home prices rose significantly in every English region, Wales and Scotland during the last month. Marketing times remain very low by any historic precedent. Higher prices appear to pose no significant obstacle, as one should expect during a period of rapid monetary inflation. Such is the vim and vigour of the market that even the North East, formerly overwhelmed with stock and stagnating prices, has now entered a boom phase. Demand has decimated the stock for sale over the last year and prices are rising rapidly.
Relative scarcity persists across all regions with the average stock total dropping around 11% year-on-year. The largest falls in unsold sales stock are found in the North East (19.0%) and London (18.7%), and these trends strongly suggest further strong price growth going forward. However, the first real indications of rising supply are evident in the East of England and East Midlands where the rate of new instructions rose by 10% and 12% respectively compared to May 2021. Overall, supply across the UK is up 5% year-on-year.
Rents are up year-on-year across all regions. The mix-adjusted average rise for the UK is 18.8%. Supply is worsening in this sector too, with newly available rental properties down by 24% compared to May 2021.
The annualised mix-adjusted average asking price growth across England and Wales is now at +6.5%; in June 2021, the annualised rate of increase of home prices was 9.0%.
- Asking prices across England and Wales surged a further 0.9% overall in May, bringing the year-on-year rise to 6.5% while inflation leapt to 13% (RPI ex. housing), according to April 2022 figures from the Office of National Statistics.
- The property market continues to outpace even last year’s blistering pace. Typical Time on Market (median) for unsold property is 60 days, which is 16 days less than in June 2021.
- Supply eases slightly as vendors are tempted by much higher prices. Five per cent more properties were placed on the market last month compared to May 2021. London, however, indicated a 4% year-on-year drop in supply.
- The total stock of property for sale in England and Wales nudged up again and passed the 250,000 mark for the first time since October last year.
- The South West property market continues to lead in annualised regional price growth (+10.0%), narrowly ahead of Wales (+9.5%).
- Rents in Greater London continue their upward spiral. High demand and falling supply of available properties to let has pushed up annualised rental growth an alarming 27.6%. The mix-adjusted average monthly rent in the capital region is now 25% higher than in pre-COVID June 2019.
- Asking rent growth across the UK currently stands at 18.8% year-on-year.
- Central London rents continue to set new records as supply plummets. Aside from the City (+51%), the greatest rises in asking rents over the last twelve months are now in Lambeth (+44%) and Hackney (+43%).
Hybrid Work Start-up Upflex Accelerates Expansion in Europe With Landmark Space Deal
London, July 5, 2022 – Upflex, the premier global provider of hybrid workspace solutions, has agreed to a major commercial deal with Landmark Space, one of the UK’s largest providers of flexible workspaces. The agreement sees Landmark become the first flex workspace operator to adopt Upflex’s technology platform for the management of Landmark’s on-demand offering and will enable seamless real-time bookings of desks and meeting rooms across the entirety of Landmark’s space network.
The Landmark deal demonstrates how Upflex’s unique platform not only enables enterprises to give the workforce instant access to on-demand flex workspace around the world, but also provides cutting-edge, tech-powered solutions to flex operators looking to optimise their own services in this new hybrid landscape, ensuring all key players in the new hybrid ecosystem — including occupiers and operators — have the technology and data to adapt and thrive in the new world of work.
Landmark is a leading workspace player with a 22-year track record in the market, operating serviced offices, coworking spaces and meeting rooms in 44 locations across eight major UK cities (including 26 prime central London locations) and servicing a total of 14,000 users.
The agreement with Upflex will enable Landmark to automate its booking capabilities to provide Landmark’s customers with an easier, instant way to book and pay for workspace and meeting rooms, thereby enhancing the user experience of its rapidly increasing on-demand customer base.
The Upflex platform will also provide in-depth insights into member preferences and workspace demand through rich, actionable data analytics, allowing Landmark to react quickly and create new experiences and services based on emerging trends.
Christophe Garnier, Co-Founder & CEO of Upflex, commented: “Our ground-breaking deal with a UK workspace provider as experienced, renowned and influential as Landmark is the natural next step for Upflex’s growth. The deal demonstrates that, in addition to connecting occupiers with the largest flex network in the world, Upflex can also provide flex operators with the solutions they need to optimise their own operations. Automation is an increasingly vital component in engaging with customers, and our offering, equips flex operators large and small with the agility they need to succeed in the current landscape and aligns them with the new demands of hybrid work, from higher security and safety standards to the expectation of instant, on-demand access. We couldn’t be more excited to be supporting Landmark in this way as we accelerate our expansion in EMEA.”
Ed Cowell, CEO Landmark, said: “Harnessing Upflex’s innovative technology marks a step-change in how we can service our growing user base in a fast-evolving digital world. The flex work market is changing rapidly as hybrid work patterns become the new norm. Our goal is to become truly technology enabled to stay ahead of the curve and to enhance the experience of our members, who want to be more fluid in how they access our diverse range of workspaces. With Upflex, we can fully optimise our mix of dedicated and on-demand offering to meet the needs of what’s now a much more distributed workforce, providing best in-class space as well as access to a market-leading tech platform. This will enable Landmark to fulfil its mission of becoming the number one provider of outstanding client experience in our industry.”
The Landmark deal follows Upflex’s $30m Series A funding round in May, which will significantly accelerate the start-up’s growth. The Series A raise was led by WeWork with participation from notable strategic investors Newmark and Cushman & Wakefield as well as returning investor Ecosystem Integrity Fund, and top venture funds including GPO Fund, Coelius Capital, Industry Ventures, Inertia Ventures, Perennial Private Investments, and Silicon Valley Bank. This brings Upflex’s total funds raised to-date to $34.1 million.
After forming an exclusive global partnership with WeWork in February, Upflex now provides on-demand access to more than 6,000 bookable locations – including WeWork’s global network – spanning around 900 cities across nearly 80 countries as it continues to grow.
In recent months, Upflex has significantly strengthened its footprint in the fast-growing European hybrid work market with the acquisition of WorkClub and the launch of Upflex EMEA, its new European HQ in London and the appointment of Isobel McKenna to head up its UK and European expansion.
In Europe, Upflex has access to over 1,900 locations, while in the UK Upflex’s network extends to over 500 locations across key regions, totalling more than 400,000 square feet of flexible, on-demand office space.
The Series A funding will see Upflex significantly accelerate its growth in the UK and Europe. Globally Upflex is targeting expansion by adding more than 200 new locations per month during 2022, of which around 100 are expected to be in UK and Europe.
The flex market in EMEA is expected to see accelerated growth on significant demand – as over 40% of occupiers anticipate increasing their use of flexible workspace and 63% of employees have a preference for a hybrid working model going forward (JLL). In the UK, the volume of flexible office space is predicted to double by 2023, compared with 2019 (Statista).
Andrew Stanton is the founder of Proptech-PR, a consultancy for Founders of Proptechs looking to grow and exit, using his influence from decades of industry experience. Separately he is a consultant to some of the biggest names in global real estate, advising on sales and acquisitions, market positioning, and operations. He is also the founder of Proptech-X Proptech & Property News, where his insights, connections and detailed analysis and commentary on proptech and real estate are second to none.