UK property market activity hits 6 month high

UK property market activity hits 6 month high

Valuations in the buy-to-let and owner-occupied sectors are on the rise, as confidence in Britain’s real estate market also drives investment levels.

Summary:

  • Activity in the UK property market is at a six-month high, with valuations in the buy-to-let and owner-occupied sectors also registering year-on-year rises
  • A 21% month-on-month uplift in buy-to-let property valuations highlights that appetite for UK property investment remains high
  • Growth markets such as the private rented sector are currently attracting significant levels of investment from institutions

As investment markets around the world continue to fluctuate and create uncertainty for investors, activity in the UK’s property market is currently at its highest level for six months.

Interest in the sector has also reached its second highest monthly level on record, the research from Connells Survey and Valuation has found.

Valuations on UK property in the owner-occupied sector in September saw a 29% year-on-year uplift, with sustained wage growth just one of a number of drivers why home owners are considering moving properties.

Also, despite announcements in George Osborne’s Summer Budget which some speculated may stifle growth in the UK’s buy-to-let market, valuations on investment property in September actually rose by 13% on an annual basis, and 21% compared to figures in August.

“Many thought the buy-to-let market might be in full retreat after a Summer Budget aimed at clamping down on the sector. But most investors’ panic was short lived as they realised that the fundamentals of buy-to-let’s profitability, namely large demand from tenants and low mortgage rates, were still in place,” said John Bagshaw, Corporate Services Director Connells Survey and Valuation.

Growth in many UK property markets has been driving investment in 2015, particularly from institutions. Changing attitudes towards home ownership, for example, is fuelling interest in the private rented sector (PRS). With over 50% of 20-39 year olds in the UK predicted to be renting in the PRS by 2025, interest is specifically marked in cities with a high density of young professionals, such as Manchester.

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