Press & News

UK Property Investment Projections 2020

09 02 2020

Following an intense political period at the end of 2019 that culminated in a Conservative victory at the General Election, there is a sense of relief among the UK public as a decision regarding Brexit has finally been made. From a property-investment standpoint, we have seen reduced uncertainty and increased confidence. In this blog post, we look at what to expect in 2020, to help you stay informed and use real-time knowledge to support your ongoing investment goals.

UK Property Investment 2020

Property Growth Spurt

No longer are homeowners delaying a potential move due to political instability. The number of property sales agreed over the past month is up 7.5% against the same period a year ago, while house prices across the UK jumped 2.3% – the fastest rate on record. We expect to see this positive activity continue as we move into spring and summer. 

While the Northern Powerhouse remains the prime location for the best yields and capital growth, investment in central London soared after the General Election thanks to increased investor confidence. The £4.9bn invested in office space in the final quarter of 2019 was a 125 per cent jump on the amount invested in the previous quarter, while the £2.3bn invested by UK-based investors was the highest amount since 2013.

Experts predict that investment volumes in the UK property market will reach £55bn in 2020, a 17% increase over 2019. A significant proportion of this growth is expected to be driven by the build-to-rent sector.

Considering that 2019 was a shaky year with less stock and a fractious political landscape, it was very positive to finish the year on a high. We can expect this positive trend to continue through 2020 now that the political landscape has levelled out and people feel more secure in making the decision to buy and sell.

The Co-Living Concept 

As co-living – where tenants enjoy hotel-style amenities and a communal living experience – becomes a more common type of development, we expect to see an increasing number of opportunities are opening up for private and institutional investors in 2020. 

Co-living is still in the very early stages of its overall journey, but it could represent an important part of the solution to the UK’s housing crisis. 

Mortgage Projections

Mortgages rates remain at historic lows, providing an extra boost to first-time and seasoned buyers as well as landlords.  However, this situation will not last forever.

A Boost to Investor Confidence

The UK market should continue to enjoy a fast recovery from the Brexit chaos with increased investor confidence and opportunities, along with high yields, particularly in comparison to an overall more tentative global economy. This may also mean overseas investors look more to the UK for opportunities, providing another boost to the market. Projections also suggest that limited supply and high demand in the office market could boost rental growth here once again. 

We must stay mindful of a potential slowdown towards the end of the year as December 2020 brings more movement with regards to the post-Brexit process. However, overall, 2020 looks set to bring an increased number and breadth of opportunities to both first-time and seasoned investors – contact our specialist team at Alesco today to find out more.

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