Building your wealth
We would all like to get a slice of profitable stock market action and property is especially hot at the moment, as Mike Collins discovers
The best performing shares of the past decade have been those with a direct connection to the UK’s burgeoning property industry. Builders and estate agents have never had it so good and investors into the sector are rolling in big profits.
Research by Bank of Scotland Investment Service has shown the clear link between the house price boom and the good fortunes of builders and others involved in the property business. London-based estate agent and property services group Savills, for example, has delivered an impressive 1949% growth since 1996, with a £1,000 investment back then growing into £20,050 today.
Other top performers include office rental firm Workspace Group (1262%) and McCarthy and Stone (1260%), which builds retirement properties. “I did invest in some property companies 10 years ago and I can’t believe how well they have done,” says architect John Collier.
He continues: “It proves the old adage that you can’t go wrong with property, as it is a scarce resource and always in great demand. I know, for example, that UK house prices have increased by 170% since 1997, while in Ireland, which is where my dad was from, they have gone up 240%. I only wish I’d invested in Irish property when I had a chance of making some money on it.”
The returns from commercial property have also been highly impressive, with the increase running at an average rate of 12.5% since 1992 and speeding up to 19% last year, according to the Investment Property Database Index.