Sourced Capital: Property prices could take 39 to 72 months to recover

Jessica Bird

April 23, 2020

property prices home earnings

Taking into account the recovery period following the most recent recession, peer-to-peer lending platform Sourced Capital has predicted that the UK housing market could take 39 to 72 months to recover from the COVID-19 crisis.

It took UK property prices 72 months to exceed their pre-crash peak of £183,082 having fallen to a low of £157,000 at the end of the 2008 recession.

However, in London this recovery time fell to just 39 months, with the market returning to form far quicker.

When it comes to the main market indices, Sourced Capital reported that recovery times tended to be more erratic, with the Dax 30 Index taking 33 months to return to its pre-crash peak, followed by the FTSE 100 at 36 months.

Across the board, market indices averaged 52 months, but the CAC 40 took 81 months to recover following the last recession.

For company shares, among big businesses, including the likes of Microsoft, Apple and Amazon, while share prices dropped, they took between 12 and 18 months to recover to pre-recession peaks.

Stephen Moss, founder and managing director of Sourced Capital, said: “It’s interesting to see how various investment options bounce back in the wake of uncertainty and the different time scales of recovery required.

“While our research has focused on the speed of recovery, investing is certainly more of a marathon rather than a sprint, and while some options may return to form sooner, others such as property provide a more stable long-term return despite growth rates taking longer to materialise.

“Of course, the higher risk investments will yield a quicker return, but they also present the greater risk and when investing, it’s always advisable to ensure you have a diverse portfolio and an investment plan that stretches years rather than months.”

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