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Election outcome sends positive ripples through property market

May 28, 2015Article by Ray Withers

Whatever your political allegiance and thoughts on the recent Conservative victory, the outcome of the UK’s general election and the impact that it has had on the country’s property market has certainly been a positive one. The Tory win has seen stability return to the pound and foreign money begin pouring into the UK again.

Good news for the housing sector

As a housing sector professional, I am delighted with the outcome of the election, which has resulted in a post-election bounce to the market after some uncertainty during April, in the run-up to the election itself.

With a stable government in place thanks to a clear majority, foreign investors have felt reassured enough to continue seeing the UK as one of the world’s best places to generate healthy returns for them. As providers of buy-to-let property in the UK, which attracts investment from around the globe, Property Frontiers has seen a noticeable spike in overseas interest during the two weeks since the election result was announced.

Showing Asia what the UK has to offer

Asian investors are one of the biggest groups interested in the UK right now and Property Frontiers has a number of connections in Asia in order to open up the UK buy-to-let market to buyers there. I was thrilled to spend a few days out there earlier this year. Most recently, our Bangkok show was a massive success, emphasising the appetite that exists across much of Asia for property ownership in the UK as a form of generating returns.

For overseas investors, the UK’s political stability is one of the key reasons why it is seen as such a trustworthy destination for investors and the election of a majority Conservative government has certainly reconfirmed this view in the eyes of the international community. Paul Welch from Largemortgageloans.com sums it up well:

“China and Chinese investors coming to the UK is the next big thing. The British government has been wooing big business and high net worth individuals in the country in a big way. If you also take into account China’s flagging economy and a potentially unstable political environment, London is seen as a safe haven for foreign money.”

Bring on the buy-to-let

In terms of property investments, buy-to-let is incredibly popular with foreign investors for several reasons. The huge level of demand for private rented accommodation in the UK is one such reason, while the potential for impressive yields and capital gains add to this asset class’ attractions.

Custom Quay in the Salford Quays are of Greater Manchester is an excellent example of attractive yields. Following two independent valuations, the project yields there have just been increased to 8.4%. Prices there are from £127,000 for a duplex, with 60 one and two bedroom apartments and duplexes available in total.

Over in Belfast, The Sandford is another strong example of buy-to-let properties in a leading market. Prices start at £110,262 for a one bedroom apartment and £136,300 for a two bed. The properties can be fully managed by a local management company and present an estimated gross yield of 7.2%. Not only is the low entry point attractive to foreign investors but it also offers exceptional value compared to similar properties in the areas.

Now that the uncertainty generated by the general election is behind us, it’s going to be an exciting few years ahead for the UK’s property sector.

For more information, contact Property Frontiers or call +44 1865 202 700.

Author

Ray Withers

Ray has over 17 years’ experience in the international property market and bought his own first international property investment back in 2002. Aside from running Property Frontiers, Ray has been involved in residential, hotel, student and commercial property investment and development in both the UK and overseas and co-wrote "Where to Buy Property Abroad - An Investor's Guide". As Founder and Trustee of the Frontiers Foundation, Ray is directly involved with many of its projects to ensure they have a direct and tangible impact in individual communities across the globe. He is passionate about property, travelling, scouting out new opportunities and finding time to spend with his young family.
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