Real Estate Investor Magazine South Africa November 2018 | Page 50

UNITED KINGDOM
ADVERTORIAL
Why Invest in the UK Market
A
lot has changed for the UK property market since
the heady, pre-recession days where anything seemed
possible. It’s a completely different animal now, more
geographically diverse and serving a variety of demands.
With the rise of Generation Rent, the decline of
homebuying, the increasing popularity of city centre living and
focus on accessibility, there’s no doubt the UK is still a global
property hotspot and the 5th largest economy, it just looks a
lot different to how it did 10 years ago.
For South African investors, uncertainty in the local
investment market has meant many are looking abroad for
property investment opportunities. In the UK, Buy-to-Let is a
huge business worth over £1 trillion with a stable currency and
huge demand, however, it can be a daunting market to join.
Bram Davies, managing partner at Sigma Property Hunt,
believes: “It is important that South African buyers understand
the immense opportunity investing in UK property presents -
world class infrastructure, with an array of architectural and
modern technologically advanced choices”.
While the focus has historically been on London, as we
look ahead to 2020 and beyond, it’s difficult to ignore the
power that the Midlands has on the market.
Birmingham is leading the way, building generational
developments that improve the infrastructure while creating
new residential and commercial space. It’s areas like
Birmingham that are quickly surpassing the average 6% yield
you might have previously only found in the capital.
Birmingham, in particular, is seeing incredible growth
through the Big City Plan, which is forecasting an extra
50,000 jobs and an increase in the city core by 25%. As the
fastest growing UK city in the last decade with a population
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NOVEMBER/DECEMBER 2018 SA Real Estate Investor Magazine
increase of 100,000 and a further 171,000 forecast by 2039
, Birmingham is attracting global businesses such as HSBC,
Deutsche Bank and PwC.
It’s not just Birmingham in the spotlight and changing
the UK landscape. Affordability is also a huge factor in the
‘London exodus’, as more renters move away from the capital
to these regional cores and commuter towns such as Slough
and Reading.
Thanks to projects such as Crossrail building unprecedented
access between commuter towns and the capital, these towns
are building ideal places to live, work and play all within
arms reach of London. This level of demand is most obvious
when we look at prices - in the last 20 years, property in the
‘traditional commuter belt’ has increased in value by 313%.
With an economy worth £9 billion, the highest
concentration of corporate headquarters outside of London
and the largest trading estate under single ownership in
Europe, Slough is a great example of a thriving commercial
landscape ready to benefit from the rising demand.
For South African investors, now is the time to look at the
UK market. Despite the uncertainty of Brexit, property prices
continue to rise, the national GDP has grown and less obvious
regional towns and cities are making a breakthrough, providing
the opportunity for a lucrative investment opportunity.
Property also remains a long-game, offering the best returns
over time. With the general consensus agreeing that markets
will stabilise after Brexit, the UK suits this long-term strategy
perfectly.
SOURCE Seven Capital