2009 The Year Of Huge Private Investment

Research by the Investment Management Association (IMA) has found that 2009 was a year for huge volumes of private property investment compared to 2008.

In their research, the IMA discovered that ten times more money was piled into private investment funds during the first 11 months of the year which as a result caused their net sales to soar past the £2 billion mark for 8 months in a row as confidence in the market grew.


And this is a stark difference to 2008 which saw fund inflows of only £2.3 billion (10% of 2009’s current figures) as investors fled the market in fear of volatile prices.

Yet investment funds are not the only niche to experience booms over the last 12 months:

• Sales of individual savings accounts have risen to £2.6 billion – their highest since 2002
• Equity funds are reported to have outsold corporate bond funds in the 3 months leading to November as investors were inspired by a 20% FTSE recovery
• Equity inflows rose to an astounding £930 million compared to the £187 million inflows which went into bond funds
• Property funds were at their highest selling capacity in November with property investors becomingly increasing confident that commercial property prices was going to rise by 78% in 2010

More than a million people aged over 50 are believed to be relying on increasing property values to help fund their retirement. Yet since the onset of the recession during autumn 2007 an estimated £27,250 is believed to have been wiped off the price of UK property values.

Even following the last 7 months which has witnessed property price increases of £15,000, this overall property loss has still severely dented pre-retirees plans to use equity release to boost their retirement.


According to popular insurance company Liverpool Victoria, more than 12% of over 50s believed so much in the capital growth of their properties that they have chosen to save less independently.

And as a consequence, many now face a reduced standard of living when they hit retirement..

Yet despite these property price falls, confidence still remains in the long term value of their properties.

Through the use of equity release - where money is taken from the value of their properties – many over 50’s plan to fund their retirement by taking money out of their properties.

However, consumer group Which? feels this could be a big mistake and should only be used as a last resort.

Expensive, inflexible, and more often than not designed to leave people with little equity to play with; property experts recommend downsizing to a smaller, cheaper property instead. Not only is downsizing easier but pre-retirees can instantly benefit from these profits.

Original Article

More About the Author

Fraser Stirling, Property Mentor Delegate

No matter what the media wants you to believe, property is still the only investment route where you can benefit from an asset that will NEVER go into zero value. Even when I was university I admired properties ability to withstand the economic elements and stay strong, even when other investment forms faltered or failed. X years on, I am now the proud owner of multiple property investments - one of which earns a passive income of £4,680 and my property portfolio is still expanding. Read more