Anyone who has picked up a newspaper, logged in to an online media website or turned on the television of late, would be forgiven for thinking that the property market is in utter turmoil and ready to implode at any minute. Brexit fears, mayoral elections and general uncertainty has led to journalists up and down the country doing what they do best – scaremongering.
However, when you consult the actual experts and speak to those who are really involved in property investment, the response that you receive can often be quite different. Take the new report from Knight Frank as a prime example. The results found in their examination of the commercial property industry show that the forecast for the future of British property investing is anything but downbeat. In fact, for asset classes such as student property, the future looks decidedly rosy.
Specialist property sectors set to increase
While it may be true that some areas of the property market are not currently performing as well as they have done in the past, being a canny investor is all about looking forward, not back. Transferring from one investment vehicle to another and pivoting when needs must is key to maintaining a buoyant portfolio, and the specialist property sector looks set to continue to offer investors a viable alternative to other, less secure opportunities.
The report states that the specialist sectors investigated – healthcare, student property, automotive and hotels – will see a 10 per cent increase in total investment this year when compared to 2015. This will take the specialist sector market to an incredible £14.3 billion by the end of the year.
Overseas investment will continue to be noteworthy, with money expected to come from Asia Pacific investors and North American funds amongst others. This proves the point that the momentum in this market is growing and that professional investors are viewing the UK’s specialist property market as a good option to bring stability to their overall investment portfolios.
Student property attracting significant attention
One area of the specialist property market that is gathering pace is the student property market. For quite some time now, student property has outperformed other parts of the British property market, and we are currently seeing more and more investors cottoning on to what is viewed as one of the most secure and balanced investments available.
Both international and institutional investment looks set to rise over the coming months and the amount of student property real estate investment trusts will also increase. Knight Frank also predict that there will be a consolidation of assets and a rental uplift that will hit 3.5 per cent during 2016.
Student property also exceeded both its five and 10 year averages in 2015, and the trend looks as though it will carry on as we move ever closer to the second half of 2016. So, for those looking to bring a more defensive asset into their investment portfolio, student property could well be the answer they have been searching for.
Has this inspired you? Then you may also be interested in Everything You Need to Know About Student Investment in the UK.
For more good news, check out Property Investors to Benefit from Tax Relief.