In an uncertain world, it is understandable that we have seen an increase in property as an investment class. People have always liked investments that they fully understand, or can see and touch. Property markets are not equal and the legalities and potential for growth and/or income vary hugely but Europe still presents many opportunities for long-term investment and yield.
Recent surveys have shown that many expats are keen to invest in property in their home country either as they consider it a more secure place than where they are currently living or as a potential base should they need to move back.
The recent upheavals in work, schooling, lifestyle and more has made many reflect on the lives that they want to lead, and to consider future plans. Initially, I saw an uplift in enquiries for wills and life cover, and while these are still popular, I am now being contacted by people about property investment in the UK and Germany. Fortunately, I can assist with both and you can invest without leaving home.
You may think you need to do the legwork yourself, such as researching a location, finding a property, or engaging a rental agent and getting tenants, that is problematic at the moment and likely to be so for a long time to come. It is also costly and time-consuming but the process can be made far easier. I am working with a number of property developers so can source good investment property that is ideal for expats who want to buy remotely. No need to spend time and money hunting for somewhere to buy when good options can be presented to you as a safe haven for your money in difficult times.
If your primary concern is to invest for capital growth and/or income, the areas to consider are not necessarily the ones you know, but the ones with the right story. Areas with the right demographic, amenities, job opportunities, government investment and redevelopment. The UK is a very mature property market so will be more secure than many places with good legal protection.
Right now, one main area to consider is the ‘Northern powerhouse’ of the North East of England, that takes in Manchester, Liverpool and surrounding areas. In the last UK budget, it was announced that there would be substantial Government investment in these areas as the infrastructure is underfunded and insufficient. This invariably leads to economic and property growth – great for investment.
Preston is just one of the options, but one that I really like the look of. A significant amount of development is taking place in this city which has a growing population and I am delighted to offer a stylish new development to clients. A former office building is being converted by a long-established developer that will be retaining 25 units for their own investment portfolio, which is always a good sign. The building will have 130 luxury apartments and good communal spaces. Prices for a one-bedroom apartment start at just £115,000 with the largest units selling for £245,000. Plenty of choice in-between.
Preston is an easily commutable distance from both Liverpool and Manchester and became a city in its own right in 2002. The area has many large employers including BAE Systems in the city itself as well as the large University of Central Lancashire, substantial retail parks. Transport links are good and it is close to the lovely Ribble Valley.
The completion date for the development is set at September 2021 and can be secured now with staged payments. Mortgage finance is available (subject to underwriting) with a facility for letting and ongoing management. Anticipated rental yield of 7.5%.
There is a good level of interest so don’t delay if this development is of interest.
I also have offerings in Birmingham, Liverpool, Manchester, Bracknell and London at varying price points so please ask if you are interested in any of these areas.
Property in Germany
Germany is one of Europe’s strongest economies and Berlin is a thriving city although property prices are still competitive compared to Munich.
I have access to a 64-unit development in the Schöneberg area of West Berlin. Prices start at €242,900 for a studio, going up to €399,900, with mortgage finance available at up to 70%. Anticipated rental yield is 4.5%. This could be an interesting additional to an international property portfolio and a letting and management service is available.
Units are available for reservation now, with stage payments, and completion due in June 2022.
A diversified portfolio
When it comes to managing investments, it is important to have a degree of diversification, in order to both spread and reduce your risks. We all need to have cash in the bank, a place to live one day, and then a mix of assets as investments. These can include pensions, personal investments and property, and a combination is invariably the best option.
Many people reading this will already have equity related investments that I manage for them, whether in a pension or directly held, and now we can easily add property into that mix. For UK property, I will also provide the relevant advice in respect of personal tax liabilities.
To arrange a discussion about investing in property, or on any aspect of your personal financial planning, please email me at email@example.com I run my own set-up under the Holborn Assets umbrella.
I am a highly-qualified and experienced Independent Financial Adviser with over 25 years of experience, the last 14 in the UAE and prior to that in the UK. I provide a fee-based personal financial planning service to expatriates resident in the GCC as well as commenting on these issues in The National newspaper and on Capital Radio UAE every week where I answer reader and listener questions. My business motto is proper advice for nice people.
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