MSCI’s head of alternatives has warned that institutions could be being priced out of the residential investment market.
In an interview with Estates Gazette, following the publication of the 2014 IPD Annual Residential Property Index, Mark Weedon warned that foreign investment was pushing up capital values as it looked for safer deposits. This was distorting the rental markets in central London and prompting UK institutions to consider building their own residential properties with an eye on rental to combat falling yields, he said.
In addition, Weedon warned that as the market in London became overpriced for long-term institutional investors and the wealthy, the South East and other regions could be next to experience disconnect between capital values and rents.
Listen to the full interview here or download from Estates Gazette’s iTunes store.
