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Why invest in the UK real estate
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The United Kingdom is a proven market with robust long-term fundamentals. Mature markets such as UK have been through many previous cycles, experiencing both peaks and drops, meaning that long term trends can be identified. Therefore, we believe it is likely that property values will appreciate in the next 3 to 4 years. For example, the residential property sector in UK doubles in price every 7 years. Since 1970 real estate prices in London have risen over 60 times. This offers a safe and secure long term investment opportunity. Although there will inevitably be short term fluctuations in market prices, real estate in the UK has always provided consistent long term growth. The recent global economic downturn has caused real estate prices to fall in many countries including UK. It presents several exciting investment opportunities for the smart investor. |
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Statistics shows that there is currently a housing shortage in the UK. This is caused by a number of social and demographic factors. We believe this also points to a period of real estate price growth. Some facts about the UK residential market:
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Due to weak British Pound, shrewd investors are showing a growing interest in the UK real estate market. Large financial institutions and pension funds are choosing to invest heavily into UK real estate because they feel it offers sound long-term potential with less risk than other asset classes such as the stock market. The population of London is forecast to expand by another 600,000 people by 2015 - we cannot foresee anything like the house building required to keep up with this demand. In addition, London is likely to remain a critically important global financial and services centre providing solid and relatively high paid employment. The philosophy of many Britons is changing, as more people come to the conclusion that rented accommodation can still be a home. According to the Royal Institution of Chartered Surveyors, House prices in the UK have risen by ten per cent, since their lowest point last April. |
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Meanwhile, Land Registry data from January shows an annual house price increase of 5.2 per cent, which is the second month in a row in which the figure has been positive, while properties for sale in London increased by an even greater amount. The change in current values, both financial and philosophical, will lead to a more general approval of the idea that a rented house can be a home, London has by far the largest number of private tenants but other areas of the country have seen substantial increases in rental property, particularly as affordability problems have grown in this decade. Indeed, with Property prices on the rise, Owning a home could be becoming an increasing pipe dream for many people in the UK, with one sector commentator warning Britons may not be able to climb on to the first rung of the property ladder until they are in their 30's. |
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The lack of first-time buyers was a worrying trend when it came to keeping the housing market moving and was most likely caused by the fact a large deposit is now needed to secure a mortgage. Britons struggling with saving up a down payment to buy a home may wish to consider to rent a property which gives them time to save while still enjoying life in the city on a more affordable budget. The situation is such where people in their 20's do not consider homeownership and that it will only become a realistic goal once in there 30's as the pay increases enabling longer time to save. London, a thriving cosmopolitan city, has long been a popular place to rent property. But finding a suitable property in London to rent has become more difficult due to a fall in the supply of rental property caused largely by a surge of 'reluctant tenants', according to the Association of Residential Letting Agents (ARLA). |
More tenants are now negotiating extensions to their current rent contracts, due to a relative shortage of alternative properties to rent, according to various London Estate Agents.