The study from investment platform Homegrown revealed that buyers from Russia and South Africa are essentially able to enjoy discounts of 21% on pre-referendum prices, while EU buyers can make the most of 16% discounts.
Anthony Rushworth, founder of Homegrown, said: “This just goes to show the incredible value that the UK property market still represents to armies of investors around the globe. Growth in the housing market has slowed over the last year but it’s still growing on an annual basis and foreign demand is bound to be playing its part.”
Aaron Strutt, director at Trinity Financial, said that property was clearly still popular with both overseas buyers and British expats looking for somewhere to invest their money, and added that his firm had seen interest from clients based all across the world including Brazil, Russia, Nigeria and Australia.
He continued: “Many expats in particular earn very good money and their living costs are minimal, plus they often make tax savings. There is still a huge shortage of properties in the UK and while prices have dropped in the prime areas of London, other areas of the UK are looking more attractive.
“We have recently had calls from expats living in countries like Qatar and Dubai, and they were buying in London and the south-east. Others have bought further afield in Scotland and Devon.”
Stamp Duty no deterrent
Last month Skipton International revealed it had seen a 130% year-on-year increase in interest in expat mortgages, noting that even the additional Stamp Duty charged on investment properties has not deterred interest.
Andrew Montlake, director at Coreco, said that foreign investors have always been keen on the London market, and while that tailed off a little in the immediate aftermath of the Brexit vote, the weakness of the pound has seen that interest return.
He added: “Despite all the issues, London especially is still seen as a safe haven compared to a lot of places in the world and a good long term investment. Lots of these buyers want their kids to study here, so they buy a place for them to live in while the kids are here and keep it as long term investment. The wealthier ones still like Knightsbridge.”
Brexit vote irony
Martin Stewart, director of London Money, said that he found it ironic that the interest from foreign buyers had been significantly boosted by the fallout of the Brexit vote, arguing that some Leave voters would have hoped the result would see a reduction in the number of foreign nationals buying property in the UK.
He continued: “We have had an increase in enquiries from the Far East and Middle East, mainly looking for buy-to-let investments in the North West of England. The yields up there are attractive, while the purchase prices and additional buying costs are much smaller.
“I can see why property continues to remain attractive for overseas investors. I would imagine the wealthy will continue to park their money in London property as part of their overall financial plan as well as an additional currency hedge.”
Research for London Mayor Sadiq Khan earlier this year revealed that 3,600 of the 28,000 new homes built in the capital between 2014 and 2016 were purchased by international buyers. Khan said it was significant that around half of those homes were priced at a level when they could instead have been bought by first-time buyers, but noted that “international investment plays a vital role in providing developers with the certainty and finance they need to increase the supply of homes and infrastructure for Londoners”.