Property Remains the Asset Class of Choice for Investment in the UK

With banks and building societies providing poor returns it is not surprising that thousands of people continue to turn to residential property as a means of supplementing their income, supported by high demand from tenants and stable yields, as property remains the investment of choice.

Despite recent changes characterised by tax and regulatory changes, and for some, higher mortgage costs, investment in property continues to outperform most major asset classes, as rents continue to rise.

Around a sixth of the UK population – some 10 million people – are now living in accommodation that is leased from private landlords: making it an attractive proposition for those investing in property.

“The private rented sector is vital to our economy and without it would see a huge increase in homelessness,” said Allison Thompson, MD of lettings at Leaders Romans Group (LRG).

Earlier this month, LRG surveyed 271 landlords across its country-wide estate agency brands, from those with a single investment property (46% of the sample) to those with ten or more (4%). It found that only 7% of landlords plan to exit the BTL market in the next year and 12% plan to reduce their portfolio.

In contrast, a considerable majority (71%) planned to maintain their portfolio size and 10% planned to expand it.

Thompson commented: “It is very good news that 81% of our landlords still see residential property as the best form of investment and plan to maintain or increase their portfolios over the next year.

“A property investment is for the long term. It is one which will see many economic cycles and changes of Government, but despite interest rates rising and falling and regulations coming and going, a property investment will invariably deliver a good financial return.