South East Asia buyers recognise potential of London property investment

Investors from South East Asia continue to recognise the value offered by London property, with over 200 flocking to attend a series of property investment seminars held by Anita Mehra and Marc von Grundherr, Directors of Benham and Reeves Residential Lettings. Anita and Marc have just returned from their latest trip to the three powerhouses of Asia – Hong Kong, Singapore and Kuala Lumpur and the message is clearer than ever. The appetite for investing in London property continues to grow.

Central London residential properties, particularly new-build properties, are being snapped up by wealthy South East Asian investors and once again, we have been overwhelmed by the interest from investors planning to purchase buy-to-let properties,” reports Marc von Grundherr. “Our latest series of property investment seminars included more presentations than ever, for example, we held six seminars in Singapore over a single weekend to meet demand. All guests were either new investors or existing investors planning
to add to their portfolio and all were serious about investing. One client we met in Kuala Lumpur already owns 57 properties in Canary Wharf and is planning further investments.”

“New developments throughout East London, in traditionally popular areas such as Canary Wharf, as well as in up and coming areas such as Greenwich, continue to attract a lot of interest from investors and during our roadshows we took on a number of new instructions for several of the latest developments to launch.”

“It’s not difficult to see why Asian investors are pouring into the London property market,” continues Marc. “London’s reputation as a safe haven for investors, the continuing weakness of sterling (which means that Asian buyers are effectively buying at a discount), the UK’s transparent legal system and of course, the excellent potential for capital appreciation, mean that London’s appeal just gets stronger.”

“Restrictive taxation in Asian countries is another factor. In Hong Kong, for example, a Stamp Duty of up to 20% is being imposed on the sale of properties owned for only a short term while a buyer’s Stamp Duty of 15% is being introduced for both local and non-local companies. And in Singapore, Stamp Duty for overseas and corporate buyers has been increased from 10% to 15%.”

“In light of these moves, it comes as no surprise that the UK’s liberal tax system continues to make London property investment very attractive for Asian investors. The recent announcement by the UK Government that it is introducing capital gains tax (CGT) on foreign owners selling residential property in the UK, a move designed to make the tax system fairer, seems so far to have had little or no effect on overseas investment in the London residential property market.”

“In fact, with rental demand in London remaining strong, fuelled by the shortage of housing stock generally and the need for homes created by the constant influx of overseas professionals relocating to London for work, we expect demand for London property to continue to rise, a view which seems to be shared by investors, judging by the level of interest at our roadshows.”