The war in Ukraine dominates investment performance, but property remains one of the most reliable assets

Market analysis by Alliance Fund, the end to end real estate fund, reveals that, in a world of economic chaos and uncertainty, real estate continues to be one of the most reliable investment assets money can buy.

A lot has been said about the future of property values. After years of COVID-fuelled price booms, the economic uncertainty that much of the world now faces has led many commentators to suggest that property no longer provides the stable investment that it has for so long. 

However, compared to some of the other most popular investment assets, Alliance Fund can reveal that property maintains its position as a valuable and reliable money maker. 

When looking at the performance of investment assets over the past year, the very best in terms of annual value growth have been gas and oil, driven, undeniably, by the ongoing war in Ukraine. 

Over the last year, the value of Natural Gas has increased by 62%, the value of Brent Crude Oil has increased by 23%, and the value of WTI Crude Oil is up 20%.

Luxury watches and fine wine, two eternally popular investment assets, have each seen their value rise by 16%, while the value of art is up 13%, marking healthy growth for these collectible assets.

Corn makes an interesting appearance on the list of most profitable having increased in value by 12%. This will no doubt be partly due to the fact that Ukraine produces a large proportion of global corn and manufacturing and supply chains have been hindered by Russia’s ongoing invasion. The resulting scarcity has led to soaring prices. 

The value of UK property, based on capital gain, has increased by 10% in the last year, or £25,556 to the current UK average price of £294,559. However, not only are pound and pence returns seen through property usually larger than luxury items, the performance of the property market is often stronger over the medium to long term. This consistency can offer a safer investment option that is less susceptible to boom and bust patterns experienced by other asset classes.

Finally, some of the more technologically-minded investors might be feeling slightly chagrined this Christmas as the value of the cryptocurrency Bitcoin has fallen a whopping -70%.

CEO of Alliance Fund, Iain Crawford, commented:

“We are seeing the value of investment assets being dominated by Russia’s invasion of Ukraine. While gas, oil, and corn are often reliable assets, their annual growth in the past year has been greatly exaggerated by the war. Their respective price rises are good news for savvy investors, but very bad news indeed for the world at large. 

Property may only rank as the eighth best investment asset in terms of percentage growth, but it is far more reliable over the medium to long-term than the temporary hikes of energy and crops.

Indeed, property has historically been one of the safer and more consistent investment options. It is relatively accessible due to a range of buying options, while segments like residential purchases, funds, buy-to-let, and even commercial spaces offer something for everyone.”