The Real Estate Sector Seems Resilient to Pandemic Shock
The Covid-19 pandemic has created huge concerns for the UK economy with many people questioning how it will survive! However, the entire situation is not as catastrophic as it is often portrayed, at least that is the case for the UK Property Sector.
At the beginning of the Covid-19 pandemic, many experts made estimates about the potential effect it would have on industries due to the implementation of an almost global lock-down to stop the spread of the virus.
Source Capital has researched the effect of the pandemic on various UK Service Sectors. Their research began after the Office of National Statistics Data revealed that 9 out of 15 Service Sectors saw the lowest percentage of growth in March 2020 and an additional 5 saw a decline in growth.
After looking at the data for this year Source Capital found that three Service Sectors managed to survive the crisis without an effect on their productivity and earnings.
One of the Service Sectors that seems to have made it through the storm is Real Estate. Contrary to speculations at the beginning of the crisis there was a growth rate of 0.15% in this sector.
Besides the Real Estate sector, two others had stability during the pandemic, the Financial and Insurance Sectors.
The study also shows that Public Administration and Defence both saw growth. However, this is the result of the pandemic and the public health needs it brought, so they will stabilize after the crisis.
Sadly, not all Service Sectors were as lucky during the crisis. The largest average monthly decline was experienced by Accommodation and Food Services. Their decline was up to 7.58% each month. Furthermore, when we look at the period between November 2019 and March 2020 there is an even larger drop in Accommodation and Food Services, a total of 32.1%.
As we slowly come out of the pandemic and a new normal emerges, it is evidently clear that the Real Estate Sector has survived and will continue to be a thriving part of the UK Service Sector!