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Unprecedented! Really?

Veteran international investor John Corey comments

Take a look at the list below, which contains some of the key topics in this edition. What strikes you as the common threads or major themes relevant to you and your property business?

  • Demographics
  • Immigration trends
  • People moving out of London and other major cities in the UK or the world
  • Logistics and the ‘last mile delivery’ challenge
  • Commercial real estate investing niches

One definite theme to note is that change is constant. Uncertainty also springs to mind. There is clearly much uncertainty going on. Compared to 2019, 2020 was unexpected. 2021 may feel like more of the same plus a light at the end of a tunnel.

Investors, like consumers, hate uncertainty. When possible, both will defer decisions until the choices are clear. Investors tend to pull out of specific deals or trading positions if they feel they could lose money. Whole investment sectors can become excluded in a flight for safety. In the extreme, investors will even loan out their money at a small loss to a perceived ‘safe’ government, compared to holding something they feel is risky. Yes, governments and a few select banks charge investors for accepting an investor's cash.

Many want to forget 2020. To date, 2021 is mostly a conversation about what is coming around the corner. We are close enough with the vaccine roll-outs for people to think they can see the light at the end of the tunnel. The UK is coming out of lockdown, and people are hoping not to return to any lockdowns later this year. The 'miracle' of science might well be real.

Brexit seems to be turning out to be just as bad as some predicted. In other ways, the EU vaccine ordering mistakes are signalling that Brexit maybe was the right decision. The difference can be one of personal circumstances. If you are in the Scottish fishing industry or otherwise shipping goods to the EU, 2021 is very painful. Living in Northern Ireland now feels more isolated from the UK than in 2020. If you have received a vaccine shot, you are likely now thanking the UK government, given how poorly the EU governments have handled their roll-outs. My point is not to say that one political choice is good or bad. I am highlighting how you invest might depend on where you live and how the recent decisions impact your strategy. The political fallout in Scotland and Northern Ireland could yet create more extreme events.

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