Huge investment predicted after lockdown

Huge investment predicted after lockdown

It’s been a particularly interesting year writing about property for a number of reasons.

Firstly, the fact that many of the biggest developments have run counter to the perceived wisdom of many, and certainly many commentators and economists, and secondly that things seem to have had such different trajectories all around the world and the west.

That’s partly down to obvious differences in international property markets, and partially down to different economies, but it also appears to have clarified the differences in the strength of different sectors.

As an example, despite the US property market being fairly stable in general, and their economy fairing relatively well, there appears to be a disconnect between their quickly recovering economy, jobs, and other indicators vs the recovery of their property prices.

The same appears to be true of European markets with Germany and France, for example, struggling to make much traction. Emerging markets in central and eastern Europe remain robust – however, they have bucked a wider trend across the continent.

And then, of course, there’s the UK market where, despite the UK economy taking a significant hit amid the shock of the pandemic, the strength of the UK property investment market has flourished and been put into sharp focus.

There are any number of explanations for this divergence, however, one of the strongest arguments is that the market here was already extremely strong and that thanks to government support and incentives it has boomed even in economically turbulent times.

Large investment

This seems to have been highlighted further this week as new research was released by the National Landlord Index, which has said that just under 60% of landlords expect to invest further into UK property and buy-to-let once the lockdown has been lifted completely.

The research went on to note that ‘This desire from landlords to expand their property portfolios in 2021 is reflected in the demand for buy-to-let mortgages with the index revealing that nearly two-fifths (37.8%) of landlords are planning to apply for one this year.’

This marries up with the idea that not just British and UK based landlords, but also international investors, are planning to up their investments across the property market in a significant way throughout this year.

Again, this appears to be a result of a number of factors. Firstly, that UK supply has been severely restricted due to the pandemic with a lack of new property coming to market.

Secondly, the demand has shot through the roof with many prioritising their living arrangements having spent the majority of their time in the pandemic stuck indoors.

Finally, the government have provided stimulus and tax cuts to the sector in order to drive investment which has, in turn, meant a bumper rise in house prices in 2020, with some areas rising above 8%.

All this leads us on to our final point which is, now may well be the time to get ahead of the curve, as with a drive in demand will come an increase in prices. If you’re thinking about getting into or expanding your presence in the property market now is the time to take action.

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