Property Booms but Caution Advised

Commercial property continues to ride the crest of a wave at present, with a good many people enthusiastically hailing it as an investment par excellence in term of robust returns. However, despite this incredibly positive outlook, some analysts are still advising an attitude of caution, as overconfidence can still result in problems, even during a period where property is very strong.

Global Interest

According to Every Investor, the strengthening economy is at the backbone of the current UK property boom, along with a largely stable political situation, ever-improving employment statistics and a capital city that remains at the very peak of its powers. As a result, the UK commercial property sector is now attracting genuinely international levels of attention, and apparently 40% of the total capital flow from commercial property now comes from overseas.

London has, as you might expect, remained at the forefront of all property investment campaigns in the UK, and the south east has also seen a large amount of investment decisions taking place. However, demand across the UK as a whole has begun to sharply increase too, as factors like competitive pricing and limited supply have conspired to create this more ‘universal’ boom. It’s largely as a consequence of such developments as these that property is now standing tall at the forefront of the UK’s best performing asset classes.

Why the Caution?

So, with such positive fortunes abounding, why the aforementioned need to be cautious? According to the Financial Times, retail investors have sunk £3.6 billion into the commercial property fund over the last 12 months, and this level of performance is precisely why property is now the top UK asset after 7 years of languishing in a state of relative obscurity. Apparently, the prevailing partiality with regards to commercial property is being ‘driven by the search for income in a world deprived of yield by ultra-loose monetary policy’, and in fact a staggering £23 billion is now tied up in commercial property.

This reliance is probably what is causing some analysts to offer a note of caution. Property is a fantastic long-term investment, but liquidity should not be a risk that’s totally overlooked. Property returns are likely to remain pretty robust in the near future, but this does not assuage the potential drawbacks of an ‘all your eggs in one basket’ investment mentality. As a result , a safer option is instead to combine property investment with another form of investment fund. In this way, profitability is practically assured, even in the long-term.

Investing Wisely

Of course, these cautions don’t negate the fact that commercial property remains hugely attractive in terms of making an investment. In fact, they confirm this status, simply advising that someone doesn’t become too over reliant upon a single asset class; no matter how ‘safe’ that asset might be. Naturally, a large part of such a risk can be negated by electing to commit to the very best investment opportunities. Just as you don’t want to become overly specialised, you don’t want to make the wrong call, and the team at Prideview Properties is well placed to help you make those informed decisions.

When it comes to commercial property in London, our property consultants can easily guide you towards all of the most lucrative deals on the market, and we can even assist you in other areas too. With our help, you’ll always be abreast of the latest developments in the world of commercial property , so if you’d like our assistance, don’t hesitate to get in touch with us today. Call 0208 863 8680 or email and we’ll be happy to discuss your query.

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