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When is the right time to invest in property?

When is the right time to invest in property?

As we see an increasing number of people now looking for new ways to invest their money, protect their wealth and look to build wealth for the future, investors have turned their attention to UK property investment – with this influx begging the question, when is the right time to invest in property?

Ultimately, there’s never really a bad time to invest in property, certainly when it comes to UK buy-to-let. Still, there is also an element of your personal financial situation, what you’re looking to get out of your investment, and the length of time you’re looking to invest over.

With big decisions such as long-term investments inevitably come further questions: How? When? Where?

We’ve put together answers to some of the most common questions associated with investing in property.

Is now a good time to invest in property in the UK?

With the economy stabilising, the Office for Budget Responsibility (OBR) has confirmed that it expects the UK to avoid recession this year, with modest growth set to be recorded.

This is reflected in more modest, but continuously growing house prices, yields and rental incomes across the UK property market.

Whilst some have been left with the impression of a market in decline, it’s worth saying that UK buy-to-let is stabilising after a historic high during the pandemic to more normal and sustainable levels, which is to be expected.

Price growth of 10% to 15% was never going to be a long-term trend and annual price growth of 3-5% is much more in line with historic norms. Rental growth on the other hand is staying steady and impressive at around 4% per year according to Zoopla figures.

Demand for rental property remains high too, with little sign of a big increase in home ownership or house building any time soon.

Will house prices drop in the UK in 2023?

It depends on the measure you’re using. Month-on-month figures are often used to demonstrate a fall in house prices, but these can be unreliable due to fluctuating demand and market conditions.

Take, for example, the disastrous mini-budget that took place or pandemic lockdowns and then unlockings. These types of events can have implications in short periods of time. Often you’ll see the media point to month-on-month figures as evidence of dropping prices.

However, the latest Office for National Statistics (ONS) figures show that house prices rose in the 12 months to January 2023, with the average price standing at just under £290,000 in the UK.

That’s not to say that prices won’t drop year-on-year in 2023, but even the worst-case prediction appears to be a drop of 5%. However, as the market across the UK rose by about 25% between 2020 and 2022, a 5% drop this year would still represent a 20% rise in 3 years, albeit in a bumpier fashion than usual.

When is the right time to invest in property?

Ultimately, it’s almost always a good time to invest in UK buy-to-let property if it’s the right investment for you and your financial situation allows for it. If you’re ready to invest now, the unrelenting demand for rental properties that looks set to continue allows investors to benefit from strong rental returns, whilst the forecast return to house price growth in the coming years also allows for capital growth in the long term.

If you would like to find out more about investing in UK buy-to-let property, why not get in touch with us today? We have almost 20 years of experience in the buy-to-let market and are perfectly placed to help you find the perfect investment for you.