The UK property market is undeniably complex, with many unique characteristics for investors to be aware of. It is also a market of great opportunity, with scope for major financial gains to be made from its various asset classes.
Specialist property consultancies can help buyers make the most of this potential. The experience and local knowledge of a UK-based consultancy can prove particularly valuable for investors from regions that have traditionally shown a strong interest in British property, such as the Middle East.
The UK has largely retained its appeal as a property investment destination for overseas buyers, despite potential challenges and sources of uncertainty such as the country’s withdrawal from the European Union.
Cluttons recently surveyed 250 wealthy property investors in the Middle East and 50 high net worth individuals in London to gauge current investment intentions. It found that the UK is the joint second most popular international destination for investors from the Gulf region, behind only India and tied with the US.
New-build residential property was found to be the most popular asset class, while capital value growth was cited as the primary reason to invest in UK housing, followed by earning a rental income.
Faisal Durrani, head of research at Cluttons, noted that the ongoing appeal of British property for Middle Eastern investors can be understood in context of wider economic trends.
“The recent recovery of sterling may mean there is a perception amongst Middle Eastern buyers to take advantage of the currency play before sterling strengthens further,” he said. “Furthermore, with oil prices starting to tick upwards once more, disposable incomes and the appetite to invest overseas will undoubtedly rise in parallel.”
Know your market
Anyone committing to a large purchase or entering a new market should feel confident they are aware of the nature of that investment – as well as the broader economic situation and other contextual factors – before going ahead.
As far as the UK is concerned, investors from Gulf nations can strengthen their understanding of the country and its property market by working with a specialist local consultancy.
Britain has witnessed its fair share of significant economic and political developments in recent years, and while these events don’t appear to have had a significant impact on investor interest in the country, buyers should still feel familiar with the most noteworthy local trends.
The biggest cause of uncertainty at the moment is unquestionably Brexit, with many questions still unanswered ahead of the UK’s official EU withdrawal date of March 29th 2019.
For the property market in particular, a number of important changes came into effect on April 6th 2018, the start of the current UK tax year. A form of tax relief that allows landlords to offset mortgage interest payments against rental income is gradually being phased out, dropping from 75 per cent to 50 per cent in the 2018-19 tax year.
The UK government is also charging higher capital gains tax rates on profits above the £11,700 allowance for buy-to-let investors.
Foreign buyers looking to take full advantage of the opportunities in British property can benefit greatly from working with local firms that know the market and can keep their clients informed and prepared.
The benefits of specialist support
A specialist property consultancy like Experience Invest can offer many welcome benefits for Middle Eastern investors seeking opportunities in the UK market.
On the financial side, there are strong incentives including early investor discounts on some projects to maximise growth potential and rental income assurances.
Our investments are fully managed and in prime locations, providing the best possible likelihood of reliable demand from tenants and consistent growth in the value of the property.
Buyers from Gulf nations who go through a specialist consultancy can also identify opportunities in the highest-performing asset classes at any given time. At the moment, purpose-built student accommodation is proving particularly lucrative in the UK, and Experience Invest is welcoming expressions of interest in Opto Student Newcastle and Aura Student Liverpool.
Arguably the strongest reasons of all for foreign buyers to use a specialist property consultancy in the UK are professionalism and experience. Backed up by years of work with clients and industry peers, established relationships with developers and proven results in past projects, Experience Invest has the qualities required to deliver success for investors.