Capital appreciation on housing far outstrips other property types

Residential property has performed far better than any other property-type in terms of appreciation over the last year, according to new data.

Any agent faced with reluctant buyers unsure of the investment potential can take heart from the fact that while all property types - industrial, warehousing, office and retail as well as residential - returned an average of only 3.5 per cent appreciation in 2016, the residential sector in isolation was by far the best performer.

There was 8.3 per cent capital appreciation for residential alone, according to the MSCI/IPD Index, produced by the Investment Property Databank and analysed for Estate Agent Today by Dataloft, the property data consultancy.

The index covers 9,000 property investments across the UK with a total value of £150 billion.

“The index is intended for large scale institutional investors – pension funds and the like – but the themes emerging from these latest results are interesting for all property investors” says Dataloft consultant Julia Middleton.

In line with other indices, this one appears to show that Brexit and the uncertainty in the period before and after the June EU Referendum had less effect on the residential sector than on other property types.

However the impact of Brexit on all properties combined was clear - the 3.5 per cent appreciation in 2016 contrasted with 13.1 per cent the year before.

You can see the full analysis here.