Property funds for retail investors had their best month of capital inflows so far this year in September.

Net retail sales totalled £117m in the month as investors regained confidence following the EU referendum, data from The Investment Association has shown.

It comes after a period of mass redemptions in the wake of the Brexit vote. In June and July combined, net redemptions hit £2.3bn, forcing funds to suspend trading or impose sharp adjustments to pricing.

Alastair Wainwright, The Investment Association’s fund market specialist, drew a distinction between the actions of fund managers and retail investors, which he said drove the improvement in capital flows in September.

Reweighting portfolios

“Property fund sales were positive in September as advised and non-advised retail customers bought into the sector; however, discretionary fund managers continued to reduce their holdings in property funds,” he said.

The scale of the redemptions in the summer are partly attributable to multi-manager funds, which had invested in retail funds to meet property allocations, reweighting their portfolios.

Some funds remained closed in September, including Henderson’s UK Property PAIF, Standard Life Investments’ UK Real Estate Fund and M&G’s Property Portfolio. All three have since reopened, with the M&G’s fund resuming trading this week. However, Aviva Investors’ £1.6bn Property Trust remains gated.