Close to three in five (58%) HNW investors intend to significantly increase their overall investment in real estate over the next 12 months.
In addition, 18% of HNW investors plan to increase their current real estate risk tolerance but 17% plan to decrease it.
This is according to property lender ASK Partners, which also reported that respondents believed life sciences, warehouses & logistics and co-living as the real estate sectors that they believe are likely to generate the best returns over the next 12 months.
HNW investors prioritise real estate?
Furthermore, respondents felt that the biggest challenges facing the real estate market according to HNW investors in the next 12 months include higher interest rates, changes in political leadership, increased regulation and changes to the tax system.
Also, 13% felt housing should be the number one top priority for an incoming government.
Daniel Austin, CEO and co-founder at ASK Partners, said: “Our research shows that investors plan to significantly boost their real estate investments in the next 12 months which is a really positive sign for capital investing in the sector and shows the strength of real estate debt as an asset class. The positive sentiment towards the life sciences, warehouses & logistics, and co-living sectors, is certainly a reflection on the investment prospects we are anticipating due to market demand. However, higher interest rates, political changes, increased regulation, and tax adjustments are seen as key challenges. To enhance investment, investors want to see the government focus on alleviating restrictions on conversions and brownfield sites, revising zoning and land use policies, and incentivising affordable housing. Addressing these issues could help overcome planning restrictions, affordability challenges, and the shortage of a construction workforce, thus strengthening the UK’s real estate market.
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