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A new survey from Ashman Bank found that two-thirds (64%) of real estate entrepreneurs are optimistic about the market outlook in the year ahead. In further evidence of market participants’ optimism, 81% of respondents believe that real estate sector funding will increase in 2023, and two-thirds (65%) expect the mortgage market to become more stable. We expect interest rates to settle as early as next year.
Despite a year characterized by economic and political instability, with 61% of respondents agreeing that market uncertainty is now at an all-time high, the survey It also revealed that 4 out of 10 people are confident their business will be viable for another year. In fact, 64% expect her business to grow in 2023.
Ashman Bank, which was granted a UK Banking License (Authorized with Restrictions or ‘AwR’) in June 2022, enlisted over 1,000 UK real estate developers to understand the critical challenges they faced in 2022. of decision makers were asked to investigate. and their outlook for the coming year. The findings reveal a promising and positive sense of the future of the real estate market, despite the backdrop of economic uncertainty.
When asked about the biggest challenges 2022 will bring to their businesses, 3 in 10 (29%) cited supply chain delays. On a related note, rising supplier costs closely followed his 27%, with the same percentage highlighting tax increases. A fifth opted for a rate hike (22%), which is not surprising given the recent rise in the benchmark interest rate has pushed rates to their highest in his 14 years.
Looking ahead to 2023, we see a similar picture in the commercial real estate sector, with supply chain delays topping the list as cited by one in four (26%) of respondents. Tax hikes and rising supplier costs ranked him second with 22% each, political uncertainty was selected by 18%, and the cost of living crisis was cited by the same share. Sixteen percent say further rate hikes are their main concern.
Ashman Bank Chief Commercial Officer Caroline Luxmore said: “Landlords and developers are currently facing major challenges, from supply chain and labor issues to political uncertainty and, of course, the cost of living crisis. Surprisingly optimistic about the opportunities it will bring to the business, the survey highlights expectations for more financing in the real estate sector in the coming year. Keeping it simple and transparent is key.
“The findings reflect how real estate SMEs decide that when one door closes, another opens. To help the industry weather the storm and come out on top in 2023, we will support these businesses and It is the responsibility of financial institutions to provide solutions that meet their needs.”
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