Overseas investors are an integral part of the UK property investment market owning huge swathes of land and properties both in the capital and further regions afield in the United Kingdom.
Brexit slowed the flow of overseas investors for a short spell as they held their breath to seeb what the outcome of the vote would do to the UK property markets, this was short live and the overseas investment bounced back strongly.
We have many world events both economically and politically happening right now, these events have made both domestic and overseas investors a little more cautious and rightly so.
According to recent research from UK property investment company The Mistoria Group, the amount of overseas investors has dropped once again and hit a new low as far as this year is concerned, but the research also shows that overseas landlords are piling into the student property market in the North West of England.
London saw the biggest decline, the numbers are still healthy with one in ten homes let this year owned by overseas landlords, down from one in four in 2010.
The UK property markets are still seeing a large number of investments from foreign nationals, recent research from Savills shows that the amounts of international investment flowing into the UK market has almost doubled in the past two years, with £1.2 billion coming from Singapore alone in 2016.
Around 25,000 new student accommodation units have been errected for the start of this academic year, while a further 14,000 are already under construction for next year.
Demand for student accommodation in the city of Liverpool is up by 35% in the past year.
Mish Liyanage, the Managing Director of The Mistoria Group, says: “It’s no surprise student property in the North West is booming with international investors. A north-south divide has opened up in the buy-to-let market, as a result of soaring property prices in London and the South East, which has made the region unprofitable for investors.
“The tougher tax measures, political uncertainty and falling house prices in London have led international investors to look for alternative asset classes, farther afield. Many have been attracted by the high yields in the North West, which boasts the ten best buy-to-let locations in the UK, while the south has the ten worst locations.”
He explains: “The type of international investors who were originally investing in the super-prime apartment bubble are now channeling their money into student flats and shared accommodation. Student property is the fastest growing sector of the market, giving investors strong returns that are well ahead of standard buy-to-let.
“In the North West, an investor can acquire a high quality three-bed HMO [House in Multiple Occupation] in Liverpool which will house four students, from £120,000 onwards. The return on investment is very attractive too, with 13% – 8% cash rental and 5% capital growth.”