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High-net-worth individuals plan further investment in UK property – Investec

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  • 11/03/2024
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High-net-worth individuals plan further investment in UK property – Investec
More than three-quarters – 77 per cent – of high-net-worth individuals (HNWIs) intend to increase their investment in UK property, a survey from a lender found.

Investec conducted a poll with corporate executives, finance professionals and entrepreneurs with average earnings of more than £510,000 and found that, on average, respondents expected to invest an additional £380,000 in property. 

Some 11 per cent wanted to increase their individual exposure to the UK property market by £500,000 or more. 

Only 14 per cent wanted to reduce their exposure, while three per cent wanted to dispose of their investments entirely. 

Around six per cent were not planning to make any changes to their investment in UK property. 

Investec said this intention to maintain in the UK’s property sector suggested the outlook on house prices and interest rates was positive. 

Respondents also showed confidence in borrowing against other assets, with 58 per cent saying they had borrowed against an investment portfolio. Of these, 21 per cent borrowed £250,000 or more. These loans are usually used to reinvest into a portfolio or help family members to buy property. 

Cheryl Quinn, private banking team lead at Investec, said: “Despite uncertainty around house prices, as a business we are seeing that a large number of high-net-worth individuals remain optimistic about the sector.

“Many view the current instability as an opportunity for increasing their exposure to UK property at an attractive price point and very much value the ability to leverage income in order to fund investment properties.” 

She added: “However, these individuals can struggle to access lending because of their complex income profiles. This is particularly true of city professionals, who often receive a large part of their renumeration as discretionary income, and entrepreneurs, who usually have a large part of their wealth tied up in their businesses.

“This, combined with the current market uncertainty, means that clients need to think carefully and seek independent expert advice before any major decisions.” 

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