What makes the UK so attractive to overseas property investors in 2022?

Property in the UK has long been considered a stable way to store value. Attractive yields and long-term relative political stability create the perfect environment for property investment. As such, overseas property investors UK purchases are continuing to increase.

It is estimated that foreign ownership of UK properties has trebled in the past decade. Buyers have been mostly spread across twenty different countries, with those from the Middle East and South-East Asia being particularly active in the UK property market. With house prices projected to continue rising over the next five years, overseas property investment looks set to continue along a similar trajectory.

Is property a good investment UK 2022?

According to one of the UK’s largest estate agents, house prices are predicted to increase by approximately 5% in 2022, which means property is currently a great investment in the UK. While the economy continues to recover after the coronavirus pandemic, the country has been left with an overdemand and undersupply of homes. This is just one of the factors behind rising property prices in the UK, however - and experts are predicting long-term growth.

Is buy to let still worth it 2022?

In addition to house prices rising by 5% over the next twelve months, experts are also predicting a rise in rents of approximately 5.5% - which is great news for buy-to-let investors. For those seeking investment opportunities in the UK, the growing post-pandemic economy is also great news.

Young professionals - often referred to as Generation Rent - are the strongest demographic of renters in the market. As this demographic spends longer and longer in the rental market, it should come as no surprise that rents are on an upward trajectory.

However, it’s not just young renters on the increase. The number of over-50s looking for rental properties has never been larger. There are currently over 1.2 million over-50s in the rental market, and an increasing population means that demand for rents is set to continue to increase over the next decade.

Why is the UK a good place to invest?

The UK is a great place for overseas property investment, as it offers secure and safe growth to investors. Whenever stock markets start eliciting a downward trend, investors are drawn to tangible assets to provide a stable income, and as a means of safeguarding their capital.

There are several reasons why the UK is a good place to invest in property in 2022, including the following:

• High rental yields: Rental income from UK property offers some of the highest yields in the world, particularly where affordable housing is concerned.
• Decreased value of the pound: In recent years, the value of the pound has been at its lowest in over 30 years. This provides those outside of the UK with an interest in overseas property investment to take advantage of exchange rates and real estate growth within the country.
• Lack of building opportunities: UK property is likely to encounter long-term capital appreciation, as there is a notable shortage of land available for developers to build new projects.
• Housing shortage: As touched upon earlier, the population of the UK is steadily increasing while too few properties have been built in recent years to cope with demand. At current building rates, it could take up to 15 years for the market to catch up.

Can overseas buy property in the UK?

It is perfectly legal for non-UK residents to purchase property in the UK. However, it is worth mentioning that overseas property investment is much easier for cash buyers - those who do not require a mortgage or additional forms of borrowing. This is because some lenders may be unwilling to lend to non-UK residents, and those that do might require larger deposits or charge higher interest fees.

However, for overseas property investors, UK property can be incredibly lucrative. There are several benefits to investing in property here, including rising property prices and high rental yields which ensure a steady, regular income.

How much of UK property is owned by foreign investors?

Over the past decade, approximately 250,000 UK properties have been purchased by foreign investors - with 8,500 of those in the past year alone. London is traditionally a target for non-residents who want to invest in UK property. Since 2010, average property prices in the capital have increased by 67%.

However, cities further North perhaps offer the best investment opportunities for overseas investors. Certain areas of Leeds, Manchester, Liverpool and Newcastle currently offer some of the highest rental yields in the country, with yields averaging around 7% in some boroughs.

Is it worth investing in property abroad?

Owning property abroad can be lucrative, particularly if you’re thinking in the long term. New market hotspots are consistently emerging and could provide great returns down the line. In addition to this, established markets in tourist hotspots are also a safe bet when it comes to overseas investment.

If a foreign property in a stable area is more affordable than a property in your home country, or if it's likely to appreciate in value at a level greater than property at home, it could make for a very worthwhile investment indeed. However, it is important to do plenty of research before making any foreign property investment decisions.

How can non-UK residents invest in UK property?

Non-UK residents are permitted to purchase property in the UK. If you are over the age of 18 and have the capital available (or are available to borrow it), there should be no restrictions on access to the UK property market (with the exception of countries facing political sanctions).

Before purchasing UK property, foreign investors should perform some due diligence, and familiarise themselves with the purchasing process, rental yields and property taxes/fees. For tools and information to make more informed property investment decisions in the UK, why not sign up to PropertyData today? With a two-week free trial, you’ll have access to a wealth of information to help you find suitable investment opportunities.