17 April – You might suspect that UK investment is dwindling post uncertain Brexit negotiations. Since the referendum in summer 2016, negativity has bombarded the headlines and left the UK unsure about its future. Nevertheless, a portion of the economy which remains undeterred by Britain’s exit out of the European Union, is its property market.
Investment in property is not just surviving, but flourishing two years after the poll that shook the UK population. Data from the Office for National Statistics demonstrated an annual rise of 4% in total investment during the final quarter of 2017. Up 1.1% on the previous quarter, a huge £84.1 billion was pumped into the economy’s building, construction, commercial and residential property sectors – music to the ears of those considering a UK investment.
One of the factors playing into the increased popularity of British buy to let property is that there is less competition from other buyers that have chosen to withdraw from the market. The ambiguity surrounding what Brexit could really mean for property in the long-term has tainted the market with slight angst and hesitation for some first-time and unexperienced investors. However, those that are more confident to take advantage of the positives of an independent Britain can enjoy a freer industry up against less contenders to secure the best investments.
Brexit’s influence on the falling pound has also made UK investments more attractive for international investors who are responsible for ploughing billions of pounds into Britain’s property business. Those overseas can buy properties with the weak pound for better value investments. A heavy input of Asian capital hit the real estate business in 2017, with Chinese investors alone spending over £2 billion to be exact.
The property market is becoming more robust and is recovering from Brexit more easily than after the credit crunch. Another optimistic outcome from Britain’s EU departure is the potential for capital growth in buy to let property. Still considered a worthy strategy for investment, with average house prices expected to rise in future years. The cost of property could increase by 60-80%, depending on area, offering massive capital appreciation on UK investments.
For anyone anxious about investing in property in a cloudy Brexit Britain, student housing provides perhaps a more secure opportunity. Student numbers are rapidly growing, establishing a concrete tenant demand for student accommodation across the UK that doesn’t seem likely to dip anytime soon. Investor tendencies to cling onto this thriving sector of the market will see a surge in investment into student apartments and pods over the next few years.
All in all, the best thing investors can do is remain optimistic. RWinvest recommends not getting caught up in stories detailing nightmare Brexit outcomes, the numbers indicate that there is nothing to worry about when it comes to the UK property market. As investment continues to flow into the economy, anyone looking for a new venture should stand up and embrace the current climate. There are many lucrative openings out there, and it seems that the most confident investors will be the ones to benefit from Britain’s booming property scene.
As published in Euro Reporter (https://www.eureporter.co/economy/2018/04/17/brexit-doesnt-deter-uk-property-investment/) 17 April 2018