International investors have always considered the UK a worthy investment as the industry offers secure and robust returns. The attraction to the UK has increased exponentially with the amount of money injected in the UK economy peaking at £1.17 trillion in 2017.
Asian investors boast the biggest appetite for property, holding responsibility for more than half of the global capital spend as Asian countries such as China have placed nearly £14 billion into Europe’s thriving property market, with over £2 billion devoted into the UK market in the first quarter of 2017 alone.
Strength in the UK Currency and Cheaper Prices
One major pull for Asian investors is the diminishing strength of the pound in comparison to Asian currencies. Since the Brexit referendum in 2016, the pound has weakened by around 17% against the Chinese yuan leading to significant savings for investors purchasing more for their money out of their home country.
Purchasing a home in China presents significantly higher prices with measly rental yields compared to the UK. Despite London being infamous for staggering house prices, it still serves as a cheaper alternative per square foot than the bustling cities of Hong Kong and Tokyo.
Uncertainty Brought by Brexit is Dismissed
The real estate industry has been one of the most prominent areas for Asian investors to entrust their money, helping to support the industry over the last couple of years following the initial turmoil that arose from the collapse of Britain leaving the EU. The property bubble remained intact as the economic decision failed to deter investment trends in Britain.
Britain’s future, due to the political disruption stands strong and leaves Britain’s reputation amongst Asian investors unhindered. UK’s renowned security of the property market is resilient enough to persuade investors to remain optimistic and trust in the market when deciding to purchase UK property.
Soaring Student Numbers
Asian money is pouring into the UK market more than ever before as China sends the most international students to the UK to study, exceeding all other nations. Holding great importance to potential Asian residents is the quality of student accommodation when relocating to the UK, therefore investing in student accommodation close to campus provides a perfect investment opportunity.
RW Invest property specialists based in Liverpool, have produced an updated student market report that states,
“By far the largest non-EU country accounted for is China. In an accumulation of our total population in the UK, Chinese students now account for 95,090, a 13.55% increase since 2013. Closely following is the student population from Hong Kong which has surpassed this rate of growth with a 27.6% increase for a total of 16,680 students studying in the UK, representing the highest amount of non-EU applicants ever recorded.”
Instability of Asian Economy
Asian investors in particular are keen to invest in the UK and spent £1.04 billion in the country during the first quarter in 2013, according to the Financial Times. Spikes in interest are perhaps as a result of the falling instability in their own country’s economy, as investors are becoming increasingly cautious about the security of their assets in their home nation as the UK is regarded as a safe haven for investment.
Deloitte revealed that £20 billion was spent on the industry by foreign buyers in 2012, while as much as 82% of property transactions in the capital during the first half of 2013 was made by international investors.
Trade and Investment Minster Lord Green states:
“The UK has received a major vote of confidence from foreign investors confirming that the UK remains a world leading business destination.”
Countries across the globe are victim of weak political and economic climates, and as the UK has fared relatively well in the case of an economic crisis, investors feel more confident placing their money in the stable, transparent nature of the market that is favourable due to increasing property prices and thriving buy to let markets present across the UK.