With Prime Minister, Boris Johnson’s announcement (10 May) of the first phase of lockdown restrictions easing in the UK it represents a positive step for the UK property market. Construction work at our developments at Nene Wharf, Peterborough, and Riverside Park, Ashford has resumed, and we continue to progress other investment opportunities elsewhere.
As a company, we pride ourselves on our knowledge of the market, which has meant we have a strong track record of identifying investment opportunities that deliver strong returns for our clients both in the UK and overseas. Using our experience, we have put together this guide to investing in UK property.
The right location at the right time
It sounds obvious, but location and timing is key to finding a good investment opportunity and we follow a core criteria that helps us to achieve this for our investors. Among the factors that we consider important are proactive local authorities, planned regeneration in the wider area and affordability, to help young professionals to get on the property ladder.
Considering supply and responding to demand is also essential in ensuring the timing is right as ultimately you need people to want to live in your properties. Picking a town, city or area that is on the up is also important, especially for achieving good returns.
Our One Smithfield Square development in Manchester is a great example of finding the right location at the right time. We recognised a lack of supply of new build apartment in the Northern Quarter of the city and decided to invest. This early investment in a landmark regeneration scheme has meant we achieved great results for our clients, with the development experiencing a 45% capital growth between Q1 2014 and Q4 2016. Manchester is starting to face an over-supply of housing, which emphasises the importance of investing in developments which reflect the needs of local people.
Moving into a developed and recovering economy
For international investors, the UK offers strong infrastructure, highly regulated markets, low interest rates and a developed economy. Moving into a new market can produce good results and we have delivered for our global clients by advising just that. Currency diversification offers further benefits by minimising the risk of damaging movements in exchange rates.
Despite the global economy being in a period of uncertainty due to the coronavirus pandemic, the UK’s economy will recover and given our experience with previous crises we would expect capital appreciation to increase with it. For instance, in the wake of the 2008 financial crash, our Olympic Apartments in Stratford secured a 37% capital growth (Q1 2010 – Q1 2012). This shows that despite economic challenges, property investment opportunities remain.
Good property management
Once you’ve decided where you are going to invest, it’s easy to underestimate the work involved with property management, especially if you’re based overseas. Good property management is important in ensuring you have happy tenants, which in turn helps to ensure it’s a worthwhile investment.
We offer full investment services, including property management, but also legal services, tax advice and exit strategy. This means our investors can benefit from experts in their field, can have everything dealt with by the same company and don’t have to deal with the day-to-day stresses of being a landlord.
Identifying the right investment opportunity is vital, but you also need to think about what happens once you’ve invested to ensure that securing solid returns is as pain-free as possible.
GRE Assets is a property investment company with major residential schemes in the UK and Spain.