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Profit in property has taken a hammering
thanks to the stringent economic conditions, but property investment is
returning as figures show that confidence is back. Deterioration in property
values is thought to have sparked investor interest.
According to reports, the UK is experiencing an
increase in buying as investors look to exploit the slide in property prices; pointing
to growing investor confidence as the economy shows signs of recovery. The
Association of Real Estate Funds (AREF) said they had witnessed a return to
property investment. Others reported that net sales were positive and
redemptions have slowed down significantly. But property investment is on the
up as the market has showed signs of stabilisation.
Deterioration in property values is thought to have
increased investor appetite as people look to purchase property amidst an
ailing market. Despite predictions that investor confidence is growing, Lynda Shillaw, managing director of
corporate real estate at Lloyds warned that property investment would remain
only in pockets of the market. Areas like Central London have attracted
interest from overseas investors looking for prime real estate at a reduced
price.
Property Investment on the Up
Property investment opportunities are becoming clear
to many investors who are swooping in on the many affordable and cut-price
property deals that have presented themselves at property auctions across the
country. Rising repossessions and slowing sales mean those who are in a strong
position can afford to reap the benefits, snapping up property bargains.
According to Country Life magazine ââ¬â a publication
that focuses on premium property ââ¬â the eventual recovery in property values is
inevitable. Savills state that the UK is now in the first stages of recovery
led by the prime property sector. It adds to the theory that there are more
signals and signs indicating a return in property investment confidence with
property prices rising by over 4% in central London. It’s felt that prime
property (the most expensive properties) will lead the recovery as these
properties tend to be less influenced and limited by mortgage finance.
Economic Variables Could Create a Two
Tier Market
Property investment could still be restricted to
areas that are less vulnerable to unemployment and job insecurity, which some
property experts believe could contribute to a two-tier market, with growth
dependent on local markets and improved accessibility to mortgage finance. Analysts
predict that although property investment will return, there could be big
disparages between regions and property sectors because of the economic
variables. It’s thought that the property investors with low debts who entered
the market when it was at its lowest and who therefore have more access to
equity and more cash, will be the breed of property investors who could be the
most successful players in the property market of the future.
Whether you want to keep up with the latest property news or search for
your ideal property and find a check out Zoopla.
