A behaviour shift following the Global Financial Crisis has left the real estate industry significantly better prepared to face future political and economic shocks than it was in 2007, research published by BNP Paribas has argued.
BNP Paribas Real Estate’s Cycology report combines analysis of past cycles, traditional forecasts and research based on the views of leading real estate investors and academics gathered by Ipsos MORI, to understand the themes that will drive real estate performance over the coming years.
The report looks at the way the industry has changed its behaviour since 2008, its views on the impact of Brexit and Donald Trump, and the ways in which transversal themes such as technology and demographics will change the industry in the future.
The findings are relevant to Bank of England warnings that a downwards real estate ‘adjustment’ could pose risks to the financial system.
The report states: ‘If the previous cycle can be characterised as being dictated by the financial system, this one has been driven by political risk. This property cycle has been shaped by the unprecedented actions of central banks following the global financial crisis, and will be defined further by the fallout of various political shocks of 2016.’