PROPERTY
Domestic property market set to bounce back in 2020
A majority of UK real estate investors are eying the domestic property market as a priority in 2020, according to recent research by Chamber strategic partner RSM. Real Estate 360, the annual
survey of more than 250 real estate investors, found that ‘home advantage’ will define the habits of UK property investors over the next two years, prompted primarily by the advent of a growing domestic economy and a clearing political climate. Yet while 96% of investors said they would prioritise the domestic market, only 10% said they would prioritise European investment, with 54% believing that overseas markets weren’t attractive. In the East Midlands, however,
respondents from the region said they are more likely to look to overseas markets than domestic markets for better returns, bucking the national trend. Sheetal Sanghvi (pictured),
RSM’s partner and Regional Head of Real Estate, said: “The economic and political landscape has changed for the better since we ran our last survey.
“It seems 2020 will mark the first
year since early 2016 in which investors will start putting their money where their mouth is. “The ‘Boris Bounce’ has served
as a factor, but so too have wider global indicators which have influenced UK investor appetite to eye domestic assets closer to home. “Amid the Covid-19 pandemic, it
remains to be seen whether this higher level of confidence will translate into increased levels of investment, as investors adjust to the market volatility.” The survey results were published before the impact of the Covid-19 pandemic and it is now likely that the higher level of confidence immediately after the election will have dissipated, with most transactions being put on hold. While London remains the UK’s
commercial and residential property powerhouse, the regions are gaining ground at an increasing pace. Asked about which sub-sector will experience the most growth in
2020, respondents in the East Midlands identified healthcare, industrial and student housing as their top three. Sheetal added: “The marked
increases in sentiment around yield prospects outside of London is partly driven by investors shying away from what remain attractive yet slowing yields in the capital, combined with the prospects afforded by Government-led growth initiatives and major transport links such as the Northern Powerhouse, HS2 and Crossrail.”
‘It remains to be seen whether this higher level of confidence will translate into increased levels of investment’
business network May 2020 63
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