Property Market Covid-19

Covid-19 and the UK Property Market: Should I Still Invest?

The UK has faced a lot of uncertainty over the past few years, with Brexit and the 2019 general election causing many to question the strength of property investment. Now that Brexit has come into effect after the UK’s final exit from the EU in January, with property prices after Brexit looking promising, the country is now facing additional uncertainty in relation to the current Coronavirus pandemic.

Coronavirus, otherwise known as Covid-19, first hit the UK at the end of January 2020 when two cases were confirmed. As numbers have grown, certain aspects of the finance world have been affected. The global stock market, for instance, experienced a plunge on 12th March. This has led many to pull out of their stocks and shares investments and look for alternative places to put their money during this time.

So what can we expect from the UK property market during this period, and is it still worth investing in UK buy to let?

Want to Learn More About Covid-19 & the UK Property Market?

Property Market Covid-19

Enter Your Details Below to Download a FREE Guide

Property Investment in Times of Uncertainty

In past times of uncertainty, the UK property market has remained robust and continued to grow and thrive. Brexit is a prime example of this. Following the Brexit vote in 2016, house prices in the UK had grown by £2,623 by October in the same year. Then, in just a year, UK property prices had increased by 4.5% by October 2017. This was a different outcome than many had anticipated following the Brexit vote, and the UK market has only continued to grow stronger as time has passed.

After Boris Johnson was elected as PM in December 2019, the UK saw what experts have coined the ‘Boris Bounce’. Due to a boost in market certainty, the UK property market experienced a lot of growth. By January, for instance, average house prices in the UK had leapt by 2.3% since 12th December.

The direction that the UK property market had taken during this time was unexpected by a lot of people in the industry. Because of this, many investors had unfortunately missed out on the chance to make a solid and lucrative investment.

Another relevant example is the swine flu outbreak which hit the UK in April 2009. During this time, house prices in the UK continued to rise by 10.1% from March 2009 to March 2010, highlighting the resilience of the UK market. In an article on Forbes, real estate expert Gary Barker advised that with newfound certainty brought on by Brexit and the Boris Bounce, it’s unlikely that the market will suddenly freeze.

 

What’s Happened to the Property Market so far?

While the stock market may have been affected by the Covid-19 outbreak, there have been no noticeable changes to property market performance so far. A recent residential market survey from the Royal Institution of Chartered Surveyors has shown that in February, property prices rose at their fastest pace since July 2018. Research by Benham and Reeves also found that 83% of those surveyed said that they were still planning to continue with property sales and purchases despite Coronavirus.

One of the biggest issues that the country is facing at this time centres around loss of income due to self-isolation. UK banks have created a solution to this by introducing ‘mortgage holidays’ for those who are struggling to pay their mortgage. Other plans that have been put in place include proposed funding packages for small businesses, helping to keep UK businesses afloat and soften the potential blow to the economy.

While we’re still unsure on the exact direction the property market will take, the key piece of advice to keep in mind is to remember that property is a tangible asset. In uncertain times, bricks and mortar have proven to be the safest place to keep your cash. Unlike other investment types, property is a long-term investment. With this in mind, it’s important to look at the big picture when weighing up whether or not to make a property purchase. Property predictions as a whole show that by 2024, property prices are set to grow by 15.3% on average in the UK, with higher growth of 24% in the North West. By backing out of the current opportunities on offer, you could be missing the chance to make lucrative, long-term returns in an ever-growing market.

If you have any current concerns about the UK property market and our property investment opportunities here at RWinvest, please get in touch. Our helpful sales consultants are happy to advise you on our current investment options and help you make the best venture at this time.

Last Unit Remaining

Reliance House Studios

Premium Studio Apartments

Liverpool Prices from £107,500

7% NET Rental Return

Completes Soon

New Block Released

Parliament Square

New Luxury Property Investments

Liverpool Prices from £94,950

7% NET Rental Return

Cherry Pick New Units

Limited Units Remaining

Parliament Square The Tower

L1 City Centre Postcode

Liverpool Prices from £94,950

7% NET Rental Return

Rooftop Spa and Indoor Pool