Residential Transactional and Living Markets
Residential Investment
Overview
My Q1 update ended with the comment that the outlook for the remainder of 2024 is one of cautious optimism and I do not believe that has changed. The UK residential investment market continues to display resilience and despite the increased cost of borrowing, an acceptance that this is now the new normal has set in and for those vendors willing and able to sell at sensible prices there are plenty of buyers.
Student Housing
Overview
The student accommodation sector experienced an increased volume of transactions in Q2. Inflation falling to the Bank’s target rate of 2% helped sentiment and the Government's decision to abolish Multiple Dwelling Relief (MDR) from 1 June, essentially raising SDLT from 1% to 5%, created a hard deadline for several transactions to complete. As expected, the volume of transactions has returned to a slower pace in June.
Residential Development
Sentiment has continued to improve across the UK residential development market in Q2 2024 with appetite re-emerging following a cautious Q1. As with all markets, there is still an anticipation waiting for interest rates to fall alongside a new government bounce to further boost sentiment. The caution that has existed is not dissimilar to post covid with a division in the market in which strong assets have been well received, whereas assets situated in peripheral locations or those overpriced have been challenging to sell.