After the global financial crisis in 2008, commercial property investments have made a gradual recovery, and have emerged as a mainstage player in the real estate sector.
The UK has been in a state of economic recovery for a long time now and, even with Brexit uncertainty on the cards, commercial property investments present advantages including lower pricing points, higher rental returns, and lower Stamp Duty taxes.
Commercial property investments and Brexit
The immediate impact after June’s vote was the fall in the value of sterling.
With some overseas investors saving up to 20% because of favourable exchange rates, property in the UK became more attractive to many international buyers.
After the 2008 crash, UK commercial and residential properties bounced back at un unprecedented rate. With the sector’s versatility, still fresh in the minds of investors, UK property is still seen as a safe haven for buyers.
Will commercial property investments triumph in 2017?
Commercial property investments may seem more complicated as a first-time property investment than a traditional buy-to-let however, the process is relatively similar.
Many people understand the drivers behind residential property investment as, let’s face it, we all need somewhere to live. As most investors have first-hand experience of buying or renting a home which makes it a relatable purchase.
While office investments are deemed less mainstream by individual investors, the drivers behind the asset class are clear.
The latest edition of Market in Minutes from Savills, total return forecasts for the commercial sector have been revised upwards after an initial downwards forecast in the wake of Brexit.
Market data is showing more positive economic news and, with upcoming political uncertainty in the USA, Savills expects that commercial property investments in the UK could be thrusted back into the limelight.
“With the election of Donald Trump as American President and the March 2017 triggering of Article 50 we expect these forecasts to be volatile into 2017 and beyond. Indeed, the 2017 elections in France, Germany and the Netherlands, along with the implementation of the first Trump policies could see the UK re-emerge as a safe haven market,” Savills reported.
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Are you interested commercial property investments? Contact Experience Invest today to find out how your property portfolio could benefit from this sector.