We look at the eight key real estate investment picks for 2025 across the residential, rural, and commercial sectors

- Family houses in educational super towns: It was a toss-up between family houses and three-bed suburban homes (beloved of the second and third steppers who we expect to drive the recovery). We’ve gone for the former given the expected drive to find good, affordable education at a time when VAT on school fees is likely to shape where more affluent families put down their roots.
- Multifamily in core cities: Despite more regulation and taxation for public landlords, the living sector continues to attract significant interest from institutional investors. With debt costs coming down, a significant pipeline of consents and renewed government support through the PRS debt guarantee scheme, we have placed our chips on multifamily making a resurgence.
- 100–250-unit development sites in areas of higher housing targets: Likely to be the sweet spot for developers seeking to rebuild their pipelines as the sales market improves. From 2025 there will be a window of opportunity to bring forward land in the 55% of local authorities that don’t have an up-to-date Local Plan and will face higher housing targets under the new Standard Method.
Commercial

- Undersupplied or late-developing logistics markets: There remain pockets of undersupply across the country, particularly in the larger size ranges which may be suitable for speculative development. For standing assets, we expect stronger rental growth in late-developing markets which have not seen the stellar rental growth achieved in more core locations.
- Good offices in core locations: In the office market, there is no substitute for a great location. We believe that the undersupply in these locations will mean that you can get A+ rental growth on B+ assets. These will be quicker and less costly to deliver into a period of undersupply.
- Prime retail streets and schemes: The return of real income growth and the high income returns that retail offers will combine to make retail property an alluring prospect for investors who are comfortable with asset management.
Rural

- Prime arable land with a resilient water supply: Food production will continue to be an important output from land and, as we navigate climate change challenges, the focus is on land with a secure, sustainable and resilient water supply.
- Land with environmental opportunities: Environmental protection and recovery is at the heart of government commitments and targets – specifically those stated in the Environment Act 2021. The Environmental Land Management scheme provides financial incentivisation for land managers and, going forward, more opportunities will be unlocked from the private markets.