Residential Transactional and Living Markets
Residential Investment
Overview
Q1 2025 has brought with it a cautious sense of optimism in the UK residential investment market, balanced by ongoing macroeconomic challenges. The year began with expectations of interest rate cuts during 2025 and the market was pleased to see a further 0.25% cut this May. At the same time, global tensions - such as the growing US tariff conflict - have injected fresh uncertainty into wider economic forecasts; although even as writing this, a trade deal between Britain and USA looks to be on the cards. It’s fair to say that periods of uncertainty can also generate opportunity, especially for long-term investors looking to deploy capital into resilient asset classes.
Student Housing
Overview
As we move through 2025, the sentiment towards the UK student accommodation market remains positive. However, it is fair to say that the pace of transactions has slowed. Gateway 2 under the Building Safety Act is causing major delays in the delivery of new PBSA schemes. This regulatory hurdle is impacting the planning pipeline and limiting supply growth. In addition, compliance requirements surrounding fire safety including compartmentation, fire doors and EWS1 remedials for existing PBSA schemes is also causing prolonged deal timeframes.
Residential Development
The UK residential development sector has seen a cautiously positive shift in momentum since the beginning of Q1 2025. Increased market activity and the stabilisation of key market factors indicate a slightly more optimistic outlook for developers.