There are a number of headwinds blowing towards the UK real estate market. The currency volatility resulting from Brexit and the COVID-19 crisis, coupled with last year’s unstable political environment, have reduced capital flows into many UK property sectors.

Looking ahead, one of the headwinds in the 2023 residential market is land use and converting land from one use to another. The United Kingdom is a supply-constrained country with an incredibly dense economy. While the country’s population is growing, an antiquated land use system makes it difficult for there to be enough supply of residential properties to meet the demand. This is in part due to the fact that converting a property from a low-density use to a high-density use is extremely challenging and involves a cumbersome system that relies heavily on local government involvement.

The pandemic exacerbated property conversion issues. Local government officials were working at home and planning committees w