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The first mover advantage


As the UK property market hits 8.4% annual growth, you’re probably wondering where the value is in the market and how to take advantage of that? As of Zoopla’s April house price index report, average house prices have exceeded £250,000 for the first time ever. In times of uncertainty and when inflation is soaring at uncontrollable levels, property continues to be the go-to asset class for investor to see strong stable returns. People looking to purchase an investment property are likely getting frustrated by this market. At Global Residential, we wanted to show investors the benefit of the first mover advantage and why that is crucial when looking for your next property investment.

The first mover advantage

Looking at areas of the UK to invest in, it’s quite clear that London at 3.6% growth isn’t performing as high as other areas. Nottingham at 10% and Birmingham at 8.5% are two examples of regional cities that are topping the house price growth figures. Investors have been interested in areas such as Manchester and Birmingham for several years now, but there was a time when it was difficult to even consider options outside of London. These cities across the midlands and the north have developed significantly over the past decade, offering very favourable returns because of the first mover advantage. But is now the time to explore other regions?

From our research, it is still clear that these cities will perform favourably for investors. As prices reach north of £500 ppsf in Birmingham and Manchester respectively, investors are considering the next up-and-coming districts. Covid-19 has reshaped our lives and home choices dramatically. The work from home trend is encouraging homeowners to search for more space and comfort. Despite the early move away from cities at the beginning of the pandemic, they have had a bounce back, as workers return to the city looking for those developments which have all the facilities they need within walking distance. The other significant trend has been the search for a greener and spacious life. All these changes in interests and preference help us identify the next first mover advantage.

How to take advantage

The answer to what is most appealing to prospective homeowners or renters is still: location, location, location. There’s a healthy balance to find for most people and the commuter belt of these cities such as Birmingham and Manchester are where the value lies. Areas that are within a 30-minute commute via train or car offer the perfect balance between nature and the city, all for a fraction of the cost. A perfect example is Burton on Trent located a 23-minute commute from Birmingham and 30 minutes from Nottingham within the heart of the national nature and forest reserve. Amazon, Nestle, DHL and JCB are all within a 20-mile radius and there are excellent connections into Derby, which is home too many of the UK’s biggest Aerospace and Automotive companies. There are other areas of interest to which investors should look out for Newcastle, Liverpool, Preston, and Bolton are some examples of key cities which can benefit from the first mover advantage.

The key to maximizing your potential is to benefit from the area’s economy’s economy doing the work for you. The fundamental issue remains that the UK has a significant supply and demand imbalance. New construction is vital throughout the country and specifically in these areas that havn’t experienced the growth yet. If you would like to get more advice on the UK property market, please get in touch with one of our experts to assist you.

Source: Zoopla


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