Please enable JavaScript.  This webapp requires JavaScript to work at its best.

Market News

What is the future of post-COVID UK property investing?

26/10/2021

In August, UK house prices hit a record high, according to figures from the Halifax House Price Index. Fuelled in no small part by the stamp duty holiday, as well, say Halifax, as “the demand for more space and greater home working”, the average cost of a property is now the highest on record at £262,954. 

But what does the future hold for UK property investing? Is now still a good time to invest, or are house prices likely to crash? 

 

An artificially-fuelled price hike?

Since the pandemic began, house prices have continued to rise. With more people working from home – as well as homeschooling – there has been an increased need for additional space, forcing many to upsize. What’s more, the government’s introduction of an extended stamp duty holiday  – as well as its mortgage guarantee scheme – have contributed to the increase in purchase activity and subsequent house price boom. 

Industry experts believe that “artificially fuelling house prices” in this way is irresponsible. Managing Director of Yes Homebuyers, Matthew Cooper, says, “Enjoy the boom while it lasts because if history has taught us anything, a bust is likely to follow”. 

 

A market crash is not necessarily imminent

While some suggest that a housing market crash is on the horizon, others believe this is not the case. Economist Fred Harrison – who correctly predicted the property crashes in both 1990 and 2008 – believes that house prices will continue to boom before the next crash in 2026, followed by a major recession. 

For some property investors, this may mean that increasing market exposure before the crash happens is the right approach. Others, however, may opt to place their funds in other investment types until the inevitable crash has happened. 

 

Take note of rental prices

Of course, property purchase prices are not the only thing to bear in mind when investing in property post-COVID. A new report from Shawbrook Bank shows that 34% of landlords plan to increase their portfolios over the next year, with 67% positive about their prospects for the coming 12 months. 

With rental yields increasing, people still looking for bigger homes and a decrease in the number of available rental properties – as well as a continued fall in buy-to-let mortgage rates – it is understandable that the appetite for BTL investment is still there, particularly in rural areas.   

 

“Stable Rise Limited is not authorised or registered by the Financial Conduct Authority. The marketing materials are not intended to provide financial advice nor promote any individual financial products.”

 

Share this article

More reading
Forgotten your password?

Notice: Trying to access array offset on value of type null in /home/customer/www/stablerise.co.uk/public_html/wp-content/themes/KING/footer.php on line 93