Property investors should be very selective about the areas where they choose to buy during 2012, warns buy-to-let specialist Assetz.
The normally upbeat firm says that with unemployment rising and the Eurozone crisis yet to play out, taking a punt on secondary – or what used to be called rising – locations could prove risky.
Stuart Law, chief executive of Assetz, said that buyer and tenant demand will continue to outstrip supply in established areas.
In contrast, he said, areas that are reliant on manufacturing or the public sector are best avoided.
Law said: “Now is not the time to take a punt on potentially ‘up and coming’ locations, or those that are dependent on sectors which are at risk from high levels of unemployment.
“The deepening Eurozone crisis is far from over and it will no doubt continue to impact the property market here in the UK by limiting the amount banks are able to lend and stifling consumer confidence.
“Buying in a strong location will help deliver a reliable rental income and a good supply of quality tenants, albeit alongside only modest capital growth for the time being.”