The U.K. is currently undervalued by credit markets relative to its economic fundamentals, according to Alan Capper, head of credit strategy at Lloyds Banking Group. He forecasts a boost to UK credit later this year when investors realize that European markets are not as secure as hoped.
"It seems as though investors are just so bullish about the overall environment that they are almost lulled into a false sense of security," he said.
(Read more: UK economy hit to 'absolute core' by floods)
However, the picture is not uniformly rosy. There are also growing concerns about a house price bubble in London. While London real estate is currently perceived as a safe haven and is attracting international investment, this could lead to "excess valuations" according to Bank of America Merrill Lynch strategists.
(Read more: UK house prices: bubble alert?)
There are also increasing concerns about domestic U.K. political risks, chiefly a "Yes" vote for Scottish independence, or a better-than-expected result for anti-European Union party the UK Independence Party (UKIP) in May's European elections.
A closer look at the country's workforce figures reveals that job security has not returned to the UK. Nearly 583,000 workers took on controversial "zero hours contracts," where they are not guaranteed a certain number of hours work, last year – more than double U.K. government estimates. These contracts make hiring easier, but also put the worker at increased risk of a fluctuating income.
And youth unemployment continues to be a concern.
Healthier business investment or foreign trade figures are needed for a stronger recovery, according to Wren-Lewis.
(Read more: UK economy: Business investment rises)
The two may go hand-in-hand, he argued.
"If you want to expand into overseas markets, bank finance has to be there. One of the worrying things is that we haven't seen that pick up in lending to SMEs yet," he said.
"This all goes back to the issue of to what extent the U.K. banking sector is fundamentally broken."
—By CNBC's Catherine Boyle. Follow her on Twitter @cboylecnbc.