Why UK Property Market has so much stability

The UK is globally known as one of if not the most stable property markets for investors, this is due to many factors. Most people will initially think UK property prices always go up over long run, however this isn’t strictly true when you take into consideration inflation and bank interest rates. It is more the case that relatively speaking prices don’t crash majorly, and if they do they recover, and then the additional factor that property will have high occupancy rate for landlords renting to tenants which is what makes the property market so attractive for investors. From her we ask the question of why the market is so stable…

1. Education system

The UK has one of the strongest education systems, right for infancy to world renowned Universities such as Oxford and Cambridge. For example in the  “2021 Best Countries Report” the UK was ranked as 2nd in the world for best  “Best Educational Systems” see report here This is not just a measure of how well students do but opportunities in what they can study and how higher education leads to a vast variety of employment opportunities.  

2. Strong job market

UK consistently ranks in the top countries in the world for highest employment rate. Currently they are ranked 10th see here. In previous years UK has ranked higher been at the number one spot within the last 5 years. This shows it consistency competes for the highest employment in the world. Employment is obviously a huge factor for the economy.  

3. Globally renowned legal system

UK is globally recognized as one of the most developed legal systems. This is highly recognized mostly by investors from locations such as UAE and Saudi Arabia. Currently ranked 2nd in the world by a usnews report. This system has a large effect on the security on property and lending where fairness and ownership is protected. This is in contrast with countries that operate on a more dictatorship government, where the wealthier population like to invest in somewhere with a level of safety they cannot find in their country of residence.  

4. Infrastructure

The same usnews report that out UK as the 2nd best legal system also ranked the UK as 3rd best infrastructure. With the invention of railways, it certainly was the first to have a major rail system but today it spends billions on roads and maintenance. With the M25 surrounding London being one of the most expensive motorways in the world to maintain.  

5. Geography

Its economy has long benefitted from its access to the sea which protects its borders whilst also serving as a medium to transport good from around Europe to across the Atlantic in the US. Other than this its small dense population and size typically means very few areas in the UK are isolated. Unlike countries with large land mass where towns can become disconnected due to distance, this is far more difficult in the UK due to its density, size and on top of that the infrastructure that connects all its major cities. This makes many towns and cities in UK stable in comparison.  

6. Safe place to park money

London is seen as the safest place for the very wealthy to park money. Although London will not offer massive yields compared to other locations, it is a small almost guaranteed income as London property doesn’t seem to fail to perform on some level. In addition to London’s solid stable performance other factors already mentioned such as the legal system further makes the UK a place for international billionaires to park their money.

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