In this episode, recorded at the Property Super Conference keynote speaker Mark Homer discusses the current picture for the economy and the possibilities for the future as we move through the economic cycle.

He provides an insight into the research and data he analyses to ensure the continuing adaptation of his business to meet the challenges of our changing economic landscape.

He discusses his current strategies and why it’s all about doing deals that work in any cycle and protecting the downside whatever the economic backdrop.

KEY TAKEAWAYS

Where we are now

• The lesson about predictions and guessing when the next recession will be and where we are in the cycle is that there are many unexpected variables in play at any point during the length of the cycle.
• It's about doing deals that work in any cycle, protecting the downside, going for a rental model, going for a long term strategy based on income.
• Based on the cycle over the last 10 years, we are on the upward trajectory - rates are low and confidence is starting to rebuild.
• Most businesses are not investing, mechanising or spending money on infrastructure because we have experienced a series of uncertainties.
• Lots of them still have the income and are making sales but because they don’t want to make long term investments they are hiring more staff.
• If there is a downturn they can make redundancies whereas it's more difficult to get back funds from long term technological investments.

The productivity puzzle

• The yield curve switched recently, often an indicator that a recession is around the corner
• The output per worker is not increasing and the cycle is changing indicating the underlying story of what will happen in the future.
• There are more investment opportunities, new housing and developments are not selling at the same rate as previously.
• My solution strategy  is to develop, keep it and rent it out
• A PRS development managed in-house provides a good yield and the capital growth comes over time.
• If you are selling, work with smaller units in areas with good rental demand and make sure yields would be good for implementation of a secondary plan – letting them out.

The next recession

• We are in the second part of the cycle, in the first half there was growth. The last cycle was 18 years long.
• Incomes have been increasing and businesses haven’t been investing resulting in money ready to be invested when Brexit is resolved and there is more certainty.
• Currently, there are opportunities and finance available, if you can adapt the ways you are investing you can move forward successfully.

BEST MOMENTS

‘The bank of England give you very specific information and households are still spending ‘

‘If you can get the site cheap enough, almost anything works, it's all dependent on what you pay and what the market is afterwards’

‘There has been a big shift which has dramatically altered the backdrop’

VALUABLE RESOURCES

Progressive Property

ABOUT THE HOST

Mark Homer is an entrepreneur investor.  He has worked with investment since he was 15 years old using the laws of wealth! He is a spreadsheet analyst with an impressive following from major publications including BBC Radio, The Wall Street Journal, The Independent, as well as co-authoring the UK’s best-selling property books.  Mark has always looked for the best investment vehicle, and at the end of 2007 with Rob Moore the co-founder of Progressive Property his joint portfolio produced more profit than any of the other investments he’d tried in the last ten years, combined.

CONTACT METHOD

Markhomer@progressiveproperty.co.uk

 https://www.linkedin.com/in/markhomer1

https://www.facebook.com/markprogressive

https://twitter.com/markprogressive