Property investors from both Hong Kong and Singapore have made a strong start in the UK so far in 2023, and certain parts of the country remain firm favourites.
The UK housing markets long-term strength over many decades is what has attracted, and continues to attract, large numbers of overseas buyers. Despite its short-term peaks and troughs, it remains a steady asset class compared with many other forms of investment that are more heavily affected by external factors.
Since the pandemic in particular, housing markets across the world have seen mixed performance, while the UK property sector continued to show its resilience. The past couple of years have been marked by high demand, strong prices and a thriving rental market.
City centres have always been a favourite among overseas property investors, and particularly those from Hong Kong and Singapore. London is one of the most popular locations, but the improving economies of some of the other regions in the UK have actually led to stronger housing market performance away from the capital.
Even some of the towns and areas surrounding the UK’s major cities, such as Reading near London and Stockport near Manchester, have experienced a surge in investment activity in recent times as regeneration and redevelopment in these locations has accelerated, attracting both local and overseas interest.
Hong Kong property investors favour the north west
According to some recent statistics from Skipton International, which is a specialist lender based in Guernsey, and Hamptons, a national estate agent, appetite has been high from property investors from Hong Kong and Singapore recently.
It found that more than 400 sales of buy-to-let properties were made using specialist mortgages from the bank in 2022 to Hong Kong buyers. Meanwhile, 200 property investors from Singapore also invested in buy-to-let homes last year using Skipton mortgages
Unsurprisingly last year, London was the favoured investment location among both Hong Kong and Singapore buyers. It is a world-renowned city for its property market, and is often viewed as a safe choice among buyers from abroad with its strong rental demand and excellent economic prospects.
However, as many investors who follow UK property market trends will know, the capital’s housing market has seen the weakest performance in recent years, while the sky-high prices can also affect landlords’ yields and affordability. Last year, 157 buyers of Skipton’s total invested in London from Hong Kong (and 102 from Singapore).
The second most popular location for Hong Kong investors in 2022 was the north west of England, where 106 property investors chose to take out buy-to-let mortgages. The likes of Manchester, Liverpool and the surrounding areas have some of the country’s strongest investment prospects at the moment.
Meanwhile, the south east and the West Midlands both attracted 58 buyers each from Hong Kong. For Singapore buyers, 34 invested in the north west, 20 in the south east and 38 in the West Midlands.
UK is a “safe haven”
Lorraine McLean, mortgage sales manager at Skipton International, said: “The findings clearly show Hong Kong and Singapore BTL purchasers see UK property as a safe haven asset class amidst last year’s political upheaval and global market volatility.
“Through introducing new products and competitive mortgage rates, Skipton International offers customers additional opportunities to fund their property portfolios.”
Jim Coupe, managing director at Skipton International, added: “The UK property market appears attractive to overseas investors for various reasons including a stable and transparent legal system, an appetite for various cities and towns, and the demand for rental properties continues to outstrip supply.”
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