The property sector is weathering the storm better than most other service sectors during the pandemic, Sourced Capital research has found.
The peer-to-peer lender undertook analysis of the UK’s service sectors after Office for National Statistics data found that nine of the UK’s 15 service sectors recorded the weakest month for growth on record in March and a further five saw a decline in growth.
Sourced Capital looked at the average monthly growth of these sectors since the Covid-19 crisis emerged late last year and found that there are three sectors that have weathered the storm.
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While there has been much talk of a property market decline, the real estate activities sector has seen an average monthly growth rate of 0.15 per cent, the P2P lender’s research found.
However, when comparing total growth in November 2019 to March 2020, there has a marginal 0.1 per cent decline, Sourced Capital added.
Other sectors to weather the storm so far include financial and insurance activities, and public administration and defence, which recorded a total increase of 0.5 per cent and 0.1 per cent respectively when comparing November to March.
However, not every service sector has fared as well. Sourced Capital’s research shows that the accommodation and food service activities sector has seen the largest average monthly decline of all sectors, with a decline of 7.58 per cent per month. The sector has also seen the largest decline over the November to March period, with a total drop of 32.1 per cent.
“The spread of the coronavirus and the resulting lockdown has hit the service industry hard and as a result, many sub sectors have seen some of the weakest rates of growth on record,” said Sourced Capital founder and managing director Stephen Moss.
“There are some positives, in that a few have managed to partially weather the storm but only time will tell as to the full impact.
“The real estate sector will be the one to watch, as so far it has remained resolute in the face of the virus. However, the latest figures only bring us up to March and the start of the nation’s lockdown, so the likelihood is there may be a further reduction in growth on the horizon.
“That said, the real estate sector has also been one of the first to resume business and it will be interesting to see if there is any immediate impact as a result of this, as well as any growth registered in the months following.
“Any positive movement that does materialise will also provide hope for those in other sectors yet to reopen.”