For overseas investors, the UK is becoming an increasingly attractive location to purchase buy to let property. House prices are rising in a number of areas, there’s plenty of rental demand, and foreign investment into the UK market is easier than in a lot of other European countries. If you’re an overseas investor and you want to make sure you’re ticking all the boxes when it comes to your investment, take a look at these tips that you should follow before buying property in the UK.
Research the best investment areas
Without researching the best UK cities and regions for property investment, you won’t know which area will benefit you the most. While many foreign investors may automatically be drawn to London for their investments, figures show that the capital’s property market is declining. House price growth is lacking in London, with predictions of just 4.5 per cent growth over the next five years. Compared to the north-west regions’ expected house price growth of 21.6 per cent, this paints a clear picture that overseas investors should look up North if they’re set on seeing significant capital growth.
It isn’t just property price growth that makes the housing market of the north-west so appealing. The region’s key cities, Liverpool and Manchester, offer some of the highest rental yields and a high level of demand for rental properties. Average yields in these cities stand at 5.05 to 5.55 per cent, with some postcodes boasting yields as high as 11.79 per cent.
Choose your property wisely
Once you’ve chosen the area you want to invest in, you should think about the type of property that will best fit your needs and expectations. The most popular types of buy to let investment in the UK are student and residential. The main difference between these two investment types are the tenants they attract, with student properties being limited to students while residential properties are open to any type of tenant. For residential properties, particularly apartments, the most common tenant type is usually young professionals. Young people are struggling to buy their own homes, which is creating a consistent demand for rental properties in the UK. This means that residential properties make a good choice for overseas investors as you’ll rest assured that your investment will always be in demand. Similar, with student accommodation, high student populations in the UK have led to a surge in demand for this type of property too. Whether you decide to invest in student or residential property, keep in mind that city-centre based apartments usually do better as tenants want to be close to their university campus or workplace.
Understand the buying process
One of the qualities that attract so many people to the UK property market is the due diligence that’s consistently carried out before entering into a contract. Instead of just handing over a contract quickly and without adequate checks and planning, UK investment requires searches, surveys, and information from the buyer and all parties involved. You must fully agree to the terms of the contract before the buying process can continue, and a separate contract must be signed by both the buyer and the managing agent. On exchange of contracts, a deposit is then paid by the buyer before completion takes place. Then, upon completion of the investment, the balance of the property is paid in full and possession of the property is obtained. It’s important to always choose a reputable, trusted company to invest with to ensure your venture and the buying process runs as smooth as possible. RW Invest is a UK property investment company with an excellent reputation, offering fantastic investment opportunities, a knowledgable team and world-class customer service.