With the New Year rolling in, it seems like we’re about to face another onslaught of unexpected hurdles. In times like this, it’s important to treasure those immutable aspects of life – if only to cling onto the tiniest bits of normalcy. Now, this may be potentially a little shocking to hear, but there are quite a few things in the UK that we can depend on. The obvious being, of course: miserable weather, dodgy politicians, and (who could forget?) TV dramas about 40-year-old unshaven detectives on a beach.
However, some other factors may be less apparent.
One such example is property investment. With a proven track record of success spanning back decades, investing in property seems to remain to be something well worth considering for those seeking lucrative ventures. But, even if 2021 showed a notable and profitable boom in the property market, are investment properties worth it?
Well, here are a few reasons to suggest that they just might be.
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There’s still a growing demand for property
In the next 20 years, the UK’s population is projected to reach around 74 million. With this in mind, it’s apparent that there is an ever-growing call for more housing within the market. Following the initial Covid-19 lockdowns two years ago, many experts predicted a considerable drop in the market – anticipating a lack of demand and interest for the property. However, this obviously was proven wrong, with 2020 seeing the aforementioned substantial rise of those wanting to buy or move into a new property.
Various experts have also reported demand will last well into this new year, with many eager for a change of scenery after spending so much time cooped up in their homes for the majority of the year. Essentially, properties are selling fast, and the biggest reason for this is the severe undersupply of property in the UK.
The main takeaway is that people want new homes, but there isn’t enough to go around (With, according to Rightmove, the highest imbalance between supply and demand found in the North). This has led to a growing increase in property prices, making new builds an even hotter item in 2021/2022.
The UK rental market is in a good place
Despite various experts predicting the worst, 2020 saw record-breaking rises for the housing market, which many expect to spill over into the coming years. According to Savills, last September house price growth has seen a drop to 0.1%, down from the previous month’s increase of 2.1%, making the annual UK price growth 10.0%.
However, whilst price growth is slowing, it’s also remaining strong, and, for the first time since the Global Financial Crisis, no local authority has seen house price falls during the year to June. Currently, the UK rental market is seeing some of its highest-ever demand. At the same time, average property prices have soared to over 10% higher than they were in the previous year.
With this in mind, it’s safe to say that property investors in 2021/2022 can expect to make some massive returns.
Regeneration efforts are improving cities (and investments)
An integral part of all this growth has unarguably been the level of regenerative work seen in the country recently. These projects are seen as particularly attractive to both investors and home-seekers because they increase the quality of a location, provide new job opportunities, and improve local amenities like transport.
With property prices stagnating in London and an increasing number of investors and professionals beginning to look elsewhere, cities such as these have become a promising alternative to the capital city and can potentially be very lucrative for an investor.
Are investment properties worth it?
In brief, now more than ever is probably the best time to look into investing in UK property. With property prices most likely to continue to rise in the foreseeable future, and there being little-to-no conclusive evidence of it stopping any time soon, this is probably the most affordable it’s going to be for a long time.
As with any new venture, though, it’s essential to consider your options carefully!
Study the property market, listen to the experts, perhaps even consult with a property company to help you consider the best options for Investment Properties.