For the 5th event in the Imperial Business in the City series David Miles, Professor of Financial Economics at Imperial College Business School, discussed his recent research on the future of Real Estate – specifically on whether we can expect house prices to continue to rise.
David took the audience through historical, current and future context, influences and impact on houses relative to incomes and the implications they have for home ownership. Further details of David’s research and his conclusions can be read on IB Knowledge.
On concluding his talk David was confronted with a tsunami of questions from the audience all wanting to discuss and understand the variables that will potentially affect future house prices. For example:
How might Russian oligarchs influence the price of property, especially in the ‘super-heated’ South East?
What part will construction companies play in supply and demand for property?
What if more people commute to the dense employment areas from further afield?
David agreed that the variables were many and all potentially significant. What he left us with was the prospect of a perfect storm of factors such as – a rising population, static incomes, construction techniques being unable to counterbalance high base land prices, people being unwilling to make a significant shift in spending habits from consumer goods to housing, and transport infrastructure that would be unable to improve enough to move commuters from further out from the crowded South East.