In last month's election, employment was one of the key themes adopted by several of the candidates - with numerous pledges that handing a particular politician your vote would benefit the jobs market in one way or another. However, it's as well to remember that the employment market does not only benefit a politician's job prospects but also the prospects of the humble property investor too. So in this report we will look at the latest trends in the UK employment market and go behind the headline news stories (and party political broadcasts) and try to spot any upcoming opportunities and risks for investors.
Many investors might ponder on why and how employment trends are relevant to the property market and those of us who invest in it. It's probably fair to assume that employment is one of the fundamentals behind the market. The more people who are in work the more buoyant the demand for accommodation should be. It is also quite likely to mean that more people will move around the country into areas of employment growth, pushing up levels of demand there. Increasing wage levels ought to make rent appreciation possible, yet they could also enable more people to buy creating more competition for investors and pushing up capital values.
Next let us take in and analyse some of the hard facts and figures in employment trends today and see how they might point to patterns, opportunities, risks and areas of interest in the property market. In doing this we will quote some figures from the Office for National Statistics (ONS) latest (May 2015) 'UK Labour Market Statistical Bulletin' and 'Regional Labour Market Statistical Bulletin', which look at employment market trends both in Q1 2015 and back over the last year.
Firstly, let us look at employment and unemployment levels: If rising employment is generally a positive in the wider housing market then rising unemployment might generally be considered a negative. However, those investors who are able and willing to compete in the housing benefit market, including the shared property and HMO rooms markets, may find that there are actually more opportunities open to them in those circumstances, not fewer.