Property fund outflows rose to £1.16 billion in 2024: Calastone
Calastone, the largest global funds network, said that property fund outflows increased to £1.16 billion in 2024. Investors have now reduced their property fund holdings for six years in a row and the trend is unlikely to change in the current year.
“For the UK property sector, attracting buyers has become increasingly difficult,” said Edward Glyn, head of global markets, Calastone. “The choice of funds available has fallen, restrictions on liquidity deter those who might want access to their cash and the macroeconomic picture is challenging – high interest rates in particular reduce the attractiveness of property. Unfortunately, 2025 offers little in the way of hope for inflows into property funds.”
December 2024 marked the 24th consecutive month of net selling, as £153 million left the sector. The increased outflow was driven in particular by reduced buying activity, rather than by a rising appetite to exit the sector, Calastone said.
Buy orders of £1.77 billion were less than half their 2015-2022 average and fell 16.2% year-on-year in 2024. Sell orders fell just 6.5% in 2024 to £2.92 billion.
The weak picture for the property sector is in contrast to the positive picture for equity funds, as equity fund inflows surged to a record £27.2 billion in 2024, driven in particular by global and North American funds.
“The red-hot US stock market dominated the scene in 2024 as investors piled into fund sectors with the biggest exposure,” said Glyn. “Equity funds were the clear winners.”
Investors added a net £27.22 billion to their holdings in 2024, exceeding the previous record of £19.83 billion set in 2021. Moreover, seven of the best months for equity funds on Calastone’s 10-year record were also in 2024. The year finished strongly too – investors added a net £2.91 billion to equity funds in December, despite volatile stock markets around the world.
UK-focused equity funds, by contrast, had another disappointing year. The £9.56 billion outflow was smaller than in 2023, but set against the huge inflows to equity funds overall during the year, it was the worst relative performance seen by the unloved UK-equity sector, Calastone said.
