With more than half of property investors expressing confidence in the market, let’s look at why they are finding cause for optimism.
Firstly, 2023 was a disastrous year for property investment if the forecasts were to be believed. However, the market again showed resiliency by side-stepping any potential price crash. Some house price indexes showed that prices increased over 2023. Halifax noted a 1.7% increase between December 2022 and the same period in 2023.
Additionally, inflation and interest rates are becoming more manageable than 12 months ago. In the early stages of 2023, the country was still reeling from the COVID-19 pandemic and the economic side-effects of the Ukraine war and Liz Truss and Kwasi Kwarteng’s mini-budget.
Inflation has since fallen to 4%, while interest rates have stayed at 5.25%, with rate cuts expected at some point this year. This has led mortgage lenders to lower their rates, tempting many investors back into the market. With property more affordable than it has been in a while, coupled with rental growth expected to reach 6% in 2024 (according to Savills), it’s easy to see why property investors are trusting the market again.
With buyer and seller activity up according to the last Zoopla House Price Index and more firm pricing among current supply levels, it seems that the market has turned a corner for property investors looking to expand their portfolios.
Learn More: If you want to know more about buy-to-let investing, dive into some of our handy area guides, including our guide on the buy-to-let Rochdale market.
