Safe as houses? Thinking on the rise of investment into UK residential markets
| DOI | https://doi.org/10.1108/JPIF-01-2022-0001 |
| Published date | 25 January 2022 |
| Date | 25 January 2022 |
| Pages | 324-329 |
| Subject Matter | Property management & built environment,Real estate & property,Property valuation & finance |
| Author | Nicola Livingstone |
Safe as houses? Thinking on the
rise of investment into UK
residential markets
Nicola Livingstone
Bartlett School of Planning, University College London, London, UK
Abstract
Purpose –In recent decades, institutional investment has become increasingly focussed on residential
property in the United Kingdom, reflecting interest in what was previously considered an “alternative”asset
class, but is now an evolving and ever more complex sector. This short thought piece considers how such
processes may be understood through investment-related research.
Design/methodology/approach –The UK residential market has experienced substantial capital inflows in
the wake of the global financial crisis. This reflective piece suggests there is a need for more research into
residential real estate as an institutional asset class to further unpack and understand shifting market
dynamics within the United Kingdom. It offers insight into evolving market trends across a diverse range of
investors and market sub-sectors.
Findings –This paper considers the diverse research opportunities within the residential investment markets,
including, but not limited to, the private rented sector, build-to-rent and purpose-built student accommodation,
presenting opportunities for burgeoning research.
Practical implications –The viewpoint suggests how this research lacuna may be bridged through
additional research in not just the UK residential market, but also how investors may further integrate and
operationalise UK residential assets in diversified or specialised investments, from domestic to international
propositions. The suggested research agenda promotes enhanced understandings of residential markets and
processes driving investment decision-making.
Originality/value –As the integration of residential property into vehicles such as Real Estate Investment
Trusts, private equity funds and managed multi-asset portfolios continues to increase, there is an amplified
need to understand the market context in which such investment flows occur, including the potential impact of
COVID-19, Brexit and the cyclical evolution of real estate markets more broadly.
Keywords Institutional investment, Residential, Build-to-rent, Purpose-built student accommodation, Risk,
Uncertainty
Paper type Viewpoint
Introduction
The last 40 years has seen the Journal of Property Investment and Finance (JPIF) publish
hundreds of insightful papers and articles across myriad topics, many of which have been
focussed on investment, and valuation research into the more established and traditional
sectors of office, retail and industrial real estate. However, when we consider alternative asset
classes across the world, residential real estate values substantially and consistently exceed
those found in the commercial market, but institutional investors have historically only been
a significant presence in a limited number of markets where scale, local contexts and market
dynamics allowed (such as the USA).
At the turn of the 21st century, residential real estate was not recognised as an asset class
worthy of note for institutional investment in the United Kingdom. Nor was the residential
sector ever included in any investment teaching I received as a real estate undergraduate
JPIF
40,3
324
The author would like to acknowledge that this research insight was both inspired and supported by the
Economic and Social Research Council (ESRC) and Open Research Area (ORA) as part of an ongoing
funded research project, code ES/S015078/1, on “What is Governed in Cities”(2019–2022) (https://
whatisgovernedincities.eu/).
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/1463-578X.htm
Received 3 January 2022
Revised 4 January 2022
Accepted 4 January 2022
Journal of Property Investment &
Finance
Vol. 40 No. 3, 2022
pp. 324-329
© Emerald Publishing Limited
1463-578X
DOI 10.1108/JPIF-01-2022-0001
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