The commercial market may look particularly tempting for property investors and landlords soon.
The Renters’ Rights Bill is looming, and is expected to start being rolled out following Easter.
It remains to be seen how the market will adapt to this legislation. But many fear it’ll usher in heightened costs and administrative burdens for residential landlords.
This is clearly weighing on many property investor’s minds. For Market Financial Solutions’ independent Q1 research, we surveyed landlords for their thoughts on the current state of the BTL market, and their outlook for the year ahead.
The results showed that the majority, or 58%, plan to diversify their portfolios (e.g. by investing in different regions or property types) over the next 12 months.
The commercial market, which sits outside of the Renters’ Reform Bill’s remit, could see a wave of interest in the second half of the year.
Specifically, though, what sectors could offer potential and appeal for expanding landlords?
According to CBRE, UK office investment ramped up in the final months of 2024. This could continue throughout 2025 as CIPD recently found large employers are pushing for their employees to come back to in-office work.
Also, in early 2025, additional analysis from CBRE revealed that capital values in the retail and industrial markets grew in January. Similar results were unveiled by Savills.
It found that after a few years of instability, the UK industrial and logistics investment market appears to be on a stronger footing.
Looking ahead, it expects this sector to continue offering a “compelling investment opportunity for investors across the risk spectrum”.
Evidently, as the Renters’ Rights Bill nears its final stages in parliament, there may be opportunity to explore new avenues in the property market.
Indeed, given that 2024 brought with it heightened values, lower interest rates, and yet relatively low investment columns, 2025 is poised to benefit from a stimulated pick up in investment.
By the end of the year, some £53bn could be invested in the UK commercial property market, according to CBRE.
What’s crucial is that lenders in the specialist market ensure they have the products, and levels of service necessary to accommodate this influx of demand.
