According to insights from Legal & General Investment Management’s Rob Martin, alongside global economist Dr. Rebecca Harding, at Fisher German’s annual property briefing, 2024 is shaping up to be a year of both challenge and chance for investors, with purpose-built accommodation leading the charge towards a more sustainable and profitable future.
The Promise of Purpose-Built Accommodation
Rob Martin distilled the essence of the current housing opportunity into three succinct words: “resi, resi, resi.” The burgeoning demand for specialised housing, whether it be for students or families seeking communal living arrangements, is a clarion call to investors. This emerging trend is not just about providing a roof over heads; it’s about crafting communities.
The significance of ESG (Environmental, Social, and Governance) criteria in this context cannot be overstated. Occupiers are increasingly prioritising sustainability and ethical considerations in their living choices, a trend that savvy investors are keen to accommodate. The integration of ESG principles into property investment strategies is not merely a nod to environmental stewardship but a calculated move to align with the evolving expectations of tenants and investors alike.
The road ahead, as outlined by the panelists, is fraught with uncertainty. A complex interplay of economic pressures, such as persistently high interest rates and inflation, is compounded by geopolitical tumult, including the specter of escalating conflicts and the looming shadow of major elections in key global powers. These elements coalesce into a formidable challenge for the property market, necessitating a strategic approach to investment.
Dr. Rebecca Harding’s analysis further underscores the precarious balance of the coming year. The potential for “electoral stasis” in the face of significant elections could stall decision-making processes, impacting the housing and commercial markets adversely. Furthermore, global conflicts and trade disruptions pose additional risks, potentially exacerbating economic strains.