UK consumer confidence in property investment continues to grow according to the latest results from Standard Life's Savings and Investment Index. Buy to let property has jumped in popularity as an investment vehicle by 35% in the last three months but largely at the expense of national savings products which have dipped by a quarter over the same time period.
However the proportion of people intending to save more has decreased in the last three months – from 40% to 36%. One likely explanation identified by the Standard Life Index is that more people are preparing to dip into their savings to pay for holidays or home improvements.
Meanwhile, the popularity of national savings products and of stocks and shares has fallen noticeably, which suggests that while people may be prepared to take more of a risk by investing their money in property, they are reticent about taking on a much higher level of volatility.
Trevor Matthews, CEO of Life & Pensions UK and Europe for Standard Life, said: The swing from the relatively safe haven of national savings to the more volatile area of buy to let, suggests people are prepared to take more of a risk with their money reflecting growing confidence in the property market.
However the fall in overall savings intentions is worrying as it means the savings gap is likely to widen – the opposite of what needs to happen to plug the gap.