UK Property News
GREEN SHOOTS APPEAR AS INTERNATIONAL INVESTORS EYE IMPROVING UK PROPERTY MARKET
Insight from Rayna Hunter, CEO of LH1 Global
Adobe
Historically, elections and major economic events have notable implications for the property market, both positive and negative depending on the situation. On average, the UK has recorded property value spikes of between 4-7% following an election, with market confidence often increased due to new policy promises. On the other side of the coin, negative economic events, such as national/global recessions, inflation and interest rate rises can significantly hamper market confidence resulting in a significant reduction in activity and a sharp decrease in property values.
In recent years, the UK has found itself skirting on the edge of a recession, fuelled by rising inflation, increased interest rates and an unstable political landscape that has been rocked by the implications of leaving the EU. This has had an impact on the property market and created caution and uncertainty among international property investors that have begun to waver on the long-term view of the country as a safe and stable destination for their capital.
Rayna Hunter, CEO
However, the overall impact hasn’t been as significant as some initially predicted, with property prices increasing by 2.7% in the 12-month period from June 2023. This is testament to the enduring appeal of the UK as a safe investment destination and the robustness of its property market and coupled with a new majority government and interest rates beginning to come down, the green shoots of hope are growing taller.
Since the election result was announced, enquiries to estate agents increased by 19% compared to the same period in 2023, with activity expected to increase further now the summer break is over and the Autumn rush ensues.
We have also seen a similar upturn in positivity and activity at LH1 Global, with a surge in enquiries from our international investor database across a multitude of UK developments. One development that has seen a rise in interest from overseas is Crown Works in Burton-Upon-Trent.
A deluxe development of 74 one and two-bedroom luxury rental apartments, currently gross rental yields of 18% for Short Lets and gross rental yields of 7% for Assured Shorthold Tenancies (AST) are being achieved at Crown Works, which coupled with an improved market, the incentive is there for those looking for strong returns from UK property.
Also proving popular among international buyers is Spinning Mill, a sympathetic restoration of a canal side historical flax mill in Manchester. Only the last few apartments remain, with prices at £300 per sq. ft. already attracting a mixture of local owner occupiers and overseas purchasers looking for exceptional ROIs.
Looking ahead to the final quarter, with the new Government’s first budget due in the Autumn Statement, the true impact on the wider economy and property market is still to be determined. However, the initial positivity is welcome, and this has already seen many experts alter their property market performance predictions from the start of the year. Savills, for example, improved their outlook of a modest 1.1% rise in values to 2.5%, whilst Knight Frank have altered a prediction of a 4% decline to a 3% increase in property prices following the recent election.
Whatever the future holds, now is the time for property firms, like ours, to take the initiative and ride the momentum and showcase just how much pull UK property has for purchasers from around the world due to the returns still on offer and the general stability and security that will always be a staple of this country.
For further information on LH1 Global and its wider development portfolio contact
Tel: 0207 129 7900 or Email: info@LH1.Global
