UK property investment trends for 2025
Whether you are just getting started as a buy-to-let investor or you have a large property portfolio, you should always be aware of the latest trends in the UK property investment landscape.
This is an industry that is continuously changing, but the last few years have been particularly hard to keep up with so much changing due to various external factors.
With this in mind, this post will explore a few of the main trends that are dominating the UK property investment landscape in 2025 and how you can use these to your advantage. Interested? Keep reading to find out more.
Demand for energy-efficient properties
One of the biggest trends in the UK property investment sector in 2025 is the rising demand for energy-efficient properties. This should come as no surprise as society is becoming increasingly eco-conscious and looking for ways to reduce their impact.
On top of this, the energy crisis has been a major topic in recent years, with many people struggling with their energy bills, particularly with the rise in the cost of living. Therefore, properties with energy-efficient features are in demand. Some of the best features to consider include:
- Solar panels
- Energy efficient appliance
- Smart thermostats
- Double or triple-glazing
- Insulation
What’s more, when it comes to borrowing money to fund property, many mortgage lenders offer more preferable interest rates to properties with an energy-efficiency rating of A-C.
Co-living developments
Another trend on the rise in 2025 is the popularity of co-living developments. These are large co-living spaces where people have their own spaces with communal living facilities, which provide a combination of affordable housing and community living.
This growing demand is likely driven by the increase in the cost of living, which means many young professionals are now seeking these spaces to keep costs down while still having access to high-quality living facilities.
PropTech
Unsurprisingly, technology is a major trend in the property investment sector right now. Known as PropTech, this includes impressive technologies like AI-driven platforms for market analysis and tenant screening, virtual reality property tours, and digital tools for property management.
Property investors will want to familiarise themselves with the latest tech to make smarter decisions, improve their management capabilities, and avoid falling behind the times.
High yield properties
Property investors have been responding to changes in the sector for some time, and tax changes have been a key driver for investment in higher yielding property types.
Houses of multiple occupation generate multiple rents from one premises, which means they can be much more profitable. Though they are larger and typically more expensive to buy, it is possible to enter this market by buying a relatively modest house to rent to several tenants.
Also, whilst some large HMOs are only eligible for more specialist (and higher) mortgage interest rates, if your HMO has up to 5-6 bedrooms and you put all tenants on one tenancy agreement, you may still be able to secure lower high street mortgage rates.
Whilst the tax position for holiday lets changes in April 2025, they are typically high yielding investment properties. Investors can still consider incorporating to combat the changes, as this may help lower tax costs. You will need professional tax advice to understand your personal circumstances.
Adding a commercial or semi-commercial to your portfolio can also be a route to higher yields. Some mortgage lenders will look for property investment experience, or experience in the industry your building will serve, to accept you as an applicant.
Specialist mortgage brokers
Securing funding for property investment is one of the biggest challenges for all investors. People are increasingly turning to specialist mortgage brokers, such as commercialtrust.co.uk. Understanding the products involved in property investment is particularly important, because they largely do not fall within the regulations of the Financial Conduct Authority, which are reserved for consumer targeted products only.
Although there may be fees involved in this, brokers can simplify the process of finding the best mortgage for your needs. These brokers can often help you make long-term savings and save the time and hassle of completing the paperwork and processing documents, whether this is a buy-to-let mortgage, commercial mortgage, development finance, bridge loan, or another form of borrowing.
Your property may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
These are currently the main trends shaping the UK property investment landscape in 2025. All investors should familiarise themselves with these trends and keep pace with the latest developments in order to improve performance, make smarter decisions, and avoid falling behind the times. By focusing on these areas, investors can navigate the complexities of property investment in 2025 and work towards their goals.
