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London remains a hotspot for investors from Israel

Due to its economic and political significance, London remains a sought-after investment destination amongst global investors and over the last year we have witnessed a significant rise in demand for property in the Capital from Israel.

The influx of foreign funds into the Capital, including from Israeli real estate investors, is rising as London offers an English-speaking environment, market transparency, a fair legal system, and potential for stable capital appreciation.

Israeli investors also choose London for real estate investments over other countries for the following reasons:

The world's capital city
The world’s capital city

Consistent Demand

With over £60 billion worth of real estate owned by offshore investors — London is preferred by Israeli real estate buyers due to its long-term capital growth potential and stable rental income. The investment also allows Israeli property buyers to enter Europe while providing a good risk diversification alternative.

London is also a relatively densely populated cosmopolitan metropolis with over 270 nationalities. The demand for housing is always there, combined with consistent rental returns as the city hosts numerous domestic and multinational companies and some of the best educational institutes in the world. Currently, around 605,000 international students are admitted to various London university courses.

Crossrail is a gamechanger
Crossrail is a gamechanger

Steady Capital Appreciation

Some Israeli property buyers are priced out of the local real estate market due to inflated local prices, high mortgage and purchase rates, raging house prices, and banks demanding unrealistic deposits. This, combined with the unassailable strength of the Israeli shekel, encourages investors to seek investment opportunities in financially–safe and steady London.

This is because, despite Brexit and the pandemic, London’s real estate prices have climbed by £47,500 in the last two years, with a 12.1% year-on-year increase.

Moreover, with the launch of Crossrail and significant infrastructure projects underway in practically all popular zones — there are a plethora of investment options for Israeli investors with varied budgets.

Strong rental demand
Strong rental demand

High Rental Yield

Post the pandemic, many professionals have returned to work in the city with strong demand for rental apartments in inner-London Boroughs.

London also rebounded strongly at the end of 2021, with rents rising at an all-time high — 14% in a year. According to Benham & Reeves data, rents in the Capital now average £2,193 per month, up from £1,919 last year.

With an average yield of 3-4% across most London areas — Israeli real estate buyers are snapping up lucrative buy-to-let opportunities in the Capital.

With Israel’s real estate growing expensive and local investment prospects becoming scarce, our advice to the clients is that now is the right time to invest in the booming London property market. You can get in touch with our London Sales team or contact our Middle East office for a no-obligation consultation about your individual investment goals.

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About the Author

Established in 1958, Benham and Reeves is one of London’s oldest, independently owned property lettings and sales agents.  With specialism in residential sales, corporate lettings and property management in prime areas of London, the company operates from 19 prominently located branches and 8 international offices.

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