Q1 2025 REVIEW
Although there are disruptive forces at work in the global economy, the UK property market has remained very resilient and looks set to deliver further growth in rental and capital values this year.
Demand for homes – whether for purchase or for rent – continues to exceed the available supply, and although affordability constraints have acted to dampen price growth, particularly in the South, they appear to be easing. Consequently, market surveys indicate modest but growing optimism.
This is not to say that conditions will be unfirmly positive, of course; some regions are clearly delivering better returns than others, and results also vary by property type, tenure and other variables. Careful research is therefore essential, but investors can at least feel confident that the general climate for investors is slowly improving.
· Market sentiment is generally positive.
· Average earnings are continuing to rise faster than inflation.
· Interest rates look likely to fall this year, albeit slowly.
· Price growth continues to be strongest in the UK’s more affordable markets.
· Rental values are still rising faster than inflation.
Average yields are comfortably exceeding inflation in all UK regions.
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