A number of long-term property investors are returning to the UK residential market as a result of a rise in average rents over the past 12 months, the latest Savills Spotlight on Residential Investment report has found.
The firm has revealed that there has been an upswing in rents across the UK of six per cent in the past year.
As such, Savills claims that there are "substantial opportunities" now in the market, especially for investors that have equity. In addition, many property companies are building schemes of sufficient scale to eventually sell on to institutional investors or teaming up in joint ventures with the institutions.
Jacqui Daly, director of Savills research commented: "Forward funding of development projects in London and the south-east is the key target market for these property companies. They are looking for investment partners or joint venture opportunities where their property skills can be matched to the big investors."
Savills added that it expects demand for rental property to increase in the future and stock levels to fall. This, the company said, means that the medium and longer term outlook for the rental market is positive.