More than half of property investors express distrust towards the government
In the face of various challenges, such as geopolitical pressures, a faltering economy, and a lack of trust in government following the Autumn Statement, the UK property sector has proven resilient, weathering the storm of last year, according to a recent article.
A survey conducted by Excellion Capital, a leading financial institution, has shed light on the primary concerns and confidence levels of UK property investors for 2025. The research reveals that investors are particularly confident in the value appreciation of Houses of Multiple Occupancy (HMOs) and regional city investments.
Investors see a premium in HMOs, with properties in cities such as Liverpool (39.9%), Birmingham (36.4%), and London (26.4%) selling for up to 50% above the average house price. This premium is attributed to the immediate value increases often by at least a third and ongoing yields around 12.5%, providing reliable capital appreciation over time.
There is also strong interest in relatively cheaper homes in England’s regional cities for conversion into HMOs, due to attractive yields and capital growth potential. Financing through debt can create positive leverage, significantly boosting returns on equity.
However, the survey also indicates a more cautious approach towards prime London properties, with demand still slightly below 2024 levels. Market factors such as tightening non-dom tax rules, increased stamp duty surcharge on additional properties, and global economic uncertainties like instability in the Middle East and trade tensions have created mixed confidence about the prime London market’s short-term outlook.
Despite these concerns, the UK's Build-to-Rent (BTR) sector has experienced a rapid growth surge of 173% over five years, reflecting growing investor confidence in this market segment as a stable income source.
The survey also revealed that the majority of property experts plan to focus on investment, followed by renovation, development, land acquisition, and conversions. However, 69% of property investors lack confidence in the UK government, and 20.9% are concerned about the risk of the UK falling into recession.
Ashley Marks, head of real estate at Excellion Capital, expressed frustration about the obstacles and challenges in the property market for 2025. Despite these challenges, Marks believes that those who keep pushing forward in a challenging environment will be ahead when the waters become more calm.
The government has warned that the UK is not out of the woods yet and will need to implement strategies outlined in the Autumn Budget to navigate these economic uncertainties. The full research, including more detailed findings, can be accessed here.
[1] Excellion Capital (2025). The State of the UK Property Market 2025. [online] Available at: https://www.excellioncapital.com/research/uk-property-market-2025
[2] Knight Frank (2025). Prime London Residential Market Review Q2 2025. [online] Available at: https://www.knightfrank.com/research/prime-london-residential-market-review-q2-2025
[3] British Property Federation (2025). Build-to-Rent Market Report 2025. [online] Available at: https://www.britishpropertyfederation.co.uk/policy-and-research/build-to-rent/build-to-rent-market-report-2025
[4] The National Landlords Association (2025). Houses of Multiple Occupancy (HMOs) Guide 2025. [online] Available at: https://www.nlauk.org/knowledge-hub/houses-of-multiple-occupancy-hmos-guide-2025
- In the context of the upcoming challenges in 2025, as revealed by a survey conducted by Excellion Capital, UK property investors exhibit a particular confidence in the value appreciation of HMOs and regional city investments, driven by attractive yields and capital growth potential. This optimism is reflected in the premium paid for HMOs in cities like Liverpool, Birmingham, and London.
- The survey also indicated that despite rapid growth in the Build-to-Rent (BTR) sector, 69% of property investors lack confidence in the UK government, and 20.9% are concerned about the risk of the UK falling into recession, demonstrating a sentiment of caution in the general-news and politics landscape.
