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Increase in Chinese investors buying in the UK

23rd January 2014

There are many factors which have contributed to the increasing number of investors from China buying properties in the UK, with London being the main area in which they are interested in.

Below is a list of reasons why Chinese investors see the UK property market as an ideal place to invest their money in.

  • Trade relations between the UK and China has improved over the last few years

  • The liberalisation of China’s currency, the Renminbi (RMB)

  • The price of new homes in China is increasing

  • Number of Chinese high net worth individuals looking for offshore investments increasing

Research from W.A Ellis indicated that an estimated £3.5 billion was spent on UK properties from Chinese investors last year. The Chinese currency has also strengthened in recent years meaning that it is 8% cheaper to buy in the UK than it was 6 years ago.

It is no secret that education is very important in China. British education is seen as prestigious in terms of stature and quality, and research shows that 85% of high net worth individuals intend to send their children abroad for education, with 22% of these individuals stating that the UK is their preferred location. 

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House prices in UK increasing

21st January 2014

There has been an increased amount of activity in the property market, with one of the reasons being that first time buyers are now finally able to afford a home.

House prices, not just in the capital, but across the UK have increased in November and the Office for National Statistics (ONS) has reported an increase of 5.4% in November compared to a year ago. London saw a huge increase of over 11% compared to a year ago. Without counting the statistics for London and the South East of England, property prices increased 3% compared to the inflation rate of 2.1%, meaning that the prices of residential properties is rising faster than the general cost of living.

London has been the driving force for price increases over the last year. However, other areas across the country are now showing an increase in prices too. This could be because of the fact that first time buyers are looking further away from the capital due to fierce competition from overseas investors, coupled with the fact that other cities are generally lower in price than London. This new interest in other areas has driven prices higher than in the past.

This is good news for those who are looking to make a medium-to-long term investment in the property market. A safe investment would of course be in the capital, with previous trends showing that prices are rising here at an average of just over 5%. By renting out the investment property, landlord would see a steady flow of income until the time is right to sell the property. As with any large purchase, it is important to evaluate the property based on its age, the location it is in and the general demographics.

If you are looking to purchase a property for investment purposes, contact us for advice. We will be able to offer you expert advice, free of charge, to help you on your way to making a great investment in an asset proven to appreciate in value.

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London property prices increasing 

22nd October 2013

According to Rightmove, the average asking price of a home in London has increased by more than 10% from September to October this year.

Compared to the price of properties in other locations in England and Wales, where the increase over the month was 2.8%, the increase in London suggests it is a good time for property owners in the capital to consider selling their property.

The two months prior to the month of October had low levels of activity and a decrease in property prices. This pattern was also evident in 2009 where there were low levels of activity in summer which created volatility in the market, with a sharp unsustainable increase in October.

In London, there is an increase in buyers and demand for properties. To satisfy this increasing demand, there will also need to be an increase in the number of new-build homes or in the number of existing owners putting their property on the market.

How does this affect first-time buyers? London is seen as a safe place for investors, especially for overseas investors, when it comes to a buy-to-let property. With new developments, these types of investors are quick to purchase properties, and put them on the market for let. Although it is great for the rental market, first-time buyers are becoming increasingly frustrated at the lack of choice available to them. Furthermore, with property prices increasing, hopeful buyers are finding it more difficult to save up for the deposit, even with the government schemes available to them.

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New legislation to benefit landlords 

1st October 2013

As a landlord, evicting tenants displaying anti-social behaviour can be extremely difficult. However, a new piece of legislation is about to come into force which could make it easier for you to deal with tricky situations.

The legislation in question is the Anti-social Behaviour Crime and Policing Bill 2013-2014 which is likely to come into force very soon. Landlords will be able to gain possession of their property if an offence has been committed (the offence does not need to be in or near the property).

This legislation will introduce a new mandatory ground for possession, where courts will have to grant possession to the landlord for any of the 5 conditions below:

  1. The tenant, a member of the tenant’s household or a person visiting the property has been convicted of a serious offence.
  2. The tenant, a member of the tenant’s household or a person visiting the property has been found by a court to have breached an injunction to prevent nuisance and annoyance obtained under Clause 1 of the Bill.
  3. The tenant, a member of the tenant’s household or a person visiting the property has been convicted for breach of a criminal behaviour order.
  4. The tenant’s property has been closed under a closure order obtained under Clause 73 of the Bill and the total period of closure was more than 48 hours.
  5. The tenant, a member of the tenant’s household or a person visiting the property has been convicted of a breach of a notice or order to abate noise in relation to the tenants’ property under the Environmental Protection Act 1990.

Landlords that sell their property with an anti-social tenant in situ will also have to disclose this information to the new owner – it will be a legal duty for them to do so.

This is excellent news for landlords who have had a bad experience in the past as they will have more flexibility with the type of tenant they have in their property.

A good agent will set out in their tenancy agreement what a tenant can and cannot do so that there is no misunderstanding in what the landlord’s and tenant’s duties are. A thorough reference check is also important for prospective residents so that you, as a landlord, can relax with the knowledge that your property is being taken of. However, it is also important to remember that references only provide a snapshot of the tenant’s profile at that moment in time, and is not a guarantee of their behaviour/situation in the future.

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