Particularly for foreign investors? Offering a solid long-term investment, property can provide a consistent and reliable income for many years with minimal risk and – depending on how you approach it – pressure. However, for many, getting started may seem like a challenge. In particular, buying property in the UK as an overseas buyer may seem very daunting. Whilst it may seem like quite a hassle to get started, so long as you put the time and effort into researching the market, look into how much money you need to invest in UK property, and find the best areas to invest in – UK property can be a relatively simple and rewarding opportunity. Still, have doubts? Well, here are 3 reasons why you should consider investing in UK property as an overseas buyer.
Capital Growth and Rising House Prices
Capital appreciation is one of the most significant selling points for anyone looking to get involved with property investment. If you’re looking ahead to your retirement options, this is probably one of the most appealing aspects of this venture. If you’re patient, you can rent your property for a few years and then later sell it for a massive profit above your initial buying price. Despite some turbulence – most notably the falling value of the GBP last month – the UK property market is performing relatively well. In fact, the negative effect on the country’s economic climate proved to be a positive thing for the market – especially for international investors. With the GBP’s falling rate, foreign currencies could provide overseas investors with more value for their money, as currencies like the EUR or HKD were worth much more in comparison. This allowed investors to invest for less, owing to the falling value of the GBP, making property in the UK cheaper in comparison. The housing market in the UK is also known to remain relatively stable, despite any economic turbulence. Property is a physical asset – meaning it grows in value over time. In 2022, house prices in the UK have risen at some of the highest levels recorded as a result of supplies not being able to meet skyrocketing demand. Forecasts show that this will continue for years to come, with the North West predicted to see the most significant amount of growth, with expected rates of 11.7% by 2027. This anticipated amount exceeds that of any other region in the country, including London.
Rising Rent and Rental Yields
Rental prices have also been rising at a fast rate. In October of this year, the average rent in the UK reached £1,171, up from 10.6% compared to last year. Excluding London, the average UK rent price is 9.9% higher than last year, up to £976 per month. All this has led to some excellent rental yields in the UK – with cities like Liverpool generating impressive returns of over 10% in certain postcodes. Globally, these are some impressive yields and are – in some cases – higher than those in any other country. A popular investment hotspot like Shanghai, for example, generates an average rental profit of just 5% to 7% in comparison. Whilst the cost of living crisis in the UK might slightly dampen this growth in the future, the property market is likely still one of the most stable and growing markets in the UK.
Demand for Housing is Also Skyrocketing
UK properties are selling fast – simply because there is not enough to go around. This undersupply has resulted in higher prices for property, as well as more tenants looking to rent instead of facing the costs of buying a property solely for themselves. This is great news for any would-be investors, however, because as demand remains so high, there will be a strong influx of potential tenants for the foreseeable future.
Why Should You Invest in UK Property?
UK property is most likely one of the most profitable and continually growing ventures to get involved with at the moment – for both UK and overseas investors. With the growth rate likely to continue to stay vital for the foreseeable future, now, more than ever, is probably the best time to get started. So, now you know that investing in UK real estate as an overseas buyer is possible. It is, however, important to remember that this is just an introductory insight into the process – to truly succeed, you must keep up to date with all the latest trends, do your research and maybe even consult with experts to get the most out of your investment.
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