The last few years have seen a dramatic increase in the number of overseas buyers investing in London property, with individuals from China, Hong Kong, Malaysia and Singapore now accounting for over 50% of sales of new-build properties in central London. It’s an astonishing figure but not surprising. The continued weakness of sterling, high rental demand, the housing shortage, strong long-term capital growth and London’s historical reputation as a safe place for investment – these factors go a long way in explaining London’s appeal.
Add to this the fact that both Hong Kong and Singapore have recently increased property taxes and we can see why Far East investors are recognising the value of London rental property.
But even we were taken by surprise when over 100 investors in Hong Kong, Singapore and Kuala Lumpur turned out for the latest in our regular series of overseas investment roadshows. Clearly, the demand for investing in residential property in London is showing no signs of slowing down. We regularly read in the media about the economic factors that influence the purchase of London property but it’s interesting to meet clients face to face and find out more about what influences their personal decision to invest.
One of the most interesting facts that crops up time and time again is the desire by wealthy individuals to have their children educated in London. Often the move to buy a London property is driven by the need to provide a home while children are studying at university in London. After their children have finished studying, investors are increasingly retaining their property and keeping it as a rental investment. With prime London house prices rising 16.5% in the year to August 2012 (according to Primelocation.com), that looks like a wise moveit’s no surprise that the Capital’s bricks and mortar continue to be a big draw for property investors.
Most of the investors we meet are pretty knowledgeable about the rental property market here. They attend regular property exhibitions in the Far East and they do plenty of research, so any opportunity to learn more about how to invest in London property is welcomed with open arms.
A useful source of information for anyone considering buying or for those who already own rental properties in London is our regular investors market update. Click here to sign up and receive the latest edition.
View all posts by Anita Mehra