2023 is finally here, and as we enter the new year many investors will be re-assessing their portfolios in the hope of diversifying and enhancing their income. One of the best ways to do this in recent times has been through UK property.
Over the last few years, UK property has been one of the most prosperous investment markets as house prices, rents and demand all skyrocketed, reaching truly unprecedented heights despite the economic uncertainty of recent times.
As this extraordinary growth begins to wane and markets around the world start to settle, it begs the question – should I invest in property in 2023?
2023 Property Market Forecast
Before deciding whether or not to invest in property in 2023, it’s important to get an idea of what the 2023 property market forecast looks like.
House prices have increased at a rapid rate over the last few years. According to the latest UK House Price Index from HM Land Registry, the average price of a property in England was £316,073 – over 20% higher than the same point two years prior. Whilst this growth has been excellent for the market, it always had to come to an end and this is evident in a number of forecasts for the year ahead.
In their UK Residential Forecasts, JLL predicts that prices will drop by 6% throughout 2023. Savills also echo this sentiment in their Residential Property Market Forecasts, stating that prices across the UK will drop by 10%.
On the surface, these figures may seem alarming, but when you consider the exponential growth of recent times, this price drop is actually more of a market correction than a crisis, and according to both forecasts, house prices look set to grow in the years following culminating in an 8.2% increase in the 2023-27 period according to JLL, and a 6.2% increase according to Savills in the same period.
Despite house price growth slowing down through the coming year, rental values across the UK are set to increase drastically throughout 2023 and beyond. According to the aforementioned forecasts, throughout 2023 rents are set to increase by 4.0% (JLL) and 10% (Savills), followed by a cumulative growth of 15.9% and 18.3% respectively in the 2023-27 period.
Should I invest in property in 2023?
Judging by the forecasts above, 2023 looks set to be an excellent year to invest in property. House prices dropping through the year will allow investors to capitalise on lower price points, and with house price growth set to resume from 2024 onwards, investors have a chance to benefit from strong capital appreciation in the coming years.
In addition, rental values show no sign of slowing down thanks to the ever-increasing popularity and demand of renting amongst the younger generation. This means that investors will benefit from increasing rental returns throughout the year and beyond, earning a consistent income on a regular basis whilst their property increases in value.
Invest in property with Knight Knox
With 2023 set to be a great year for investing in property, it’s important to invest with a company you can trust.
Here at Knight Knox, we make investing in property simple. Whether you’re looking to protect your capital, would like an extra source of revenue or want to build a wide-ranging property portfolio to become financially free, we can help.
As one of the UK’s longest-standing property investment specialists with almost 20 years of experience under our belts, we are perfectly placed to help you to achieve your investment goals. Our track record speaks for itself, launching over 120 developments with a value of over £1.2 billion, 100+ of which are completed, tenanted and income-generating.
Our property investment portfolio ranges from luxury residential developments to modern student accommodation. Take a step towards your investment goals today and take a look at our available opportunities here.