New research has revealed that the number of property millionaires in the UK now stands at five times the level seen ten years ago, with 100,000 new property magnates created since 2000. This staggering increase equates to a 393 per cent growth in successful investors, a survey by Santander Mortgages has found.
While prices have declined in recent years, over the last decade there has still been over a 100 per cent growth in property values, according to the Halifax House Price Index.
Around 78 per cent of these 1 million GBP homes are located in greater London.
Phil Cliff, director of mortgages at Santander, highlighted that in recent times an increasing number of individuals were now treating property as a primary vehicle for investment.
"For many of us our home is our castle and in recent years we've often viewed our home as a key investment too," he said. "Whether you're a property millionaire
or not, prospective buyers and those remortgaging need to ensure they get a fair deal on their house and mortgage."
Meanwhile, the London Central Portfolio has suggested that there is likely to be a further increase in the level of buyer activity in the coming months. Now that the uncertainty surrounding the result of the election and Emergency Budget is over investors should begin to return
, the company said.
So what makes the UK an attractive prospect for prospective buyers?
Current Exchange Rates
Investors to Britain currently can enjoy the potential to make substantial financial savings on their property purchases thanks to the exchange rate. In the country's capital, London, 70 per cent of properties worth in excess of 5 million GBP are now being bought by foreign investors.
Research conducted by Knight Frank has found that the number of buyers from outside of the country's shores has jumped by 20 per cent within the last year, with many looking to capitalise on the current exchange rate
The weakness of the pound against other currencies such as the dollar means foreign buyers have the potential to secure huge discounts on property. Knight Frank suggested buyers from China, the US, Saudi Arabia, Singapore and Malaysia can get reductions of up to 31 per cent in total. Liam Bailey, head of residential research at the estate agents, explained that the recovery of the market was being driven by the strength in demand from international investors. He added: "Despite the fact that prices have risen, the weakness of the pound ensures that effective discounts available to foreign buyers are still very significant. "Central London is now a market apart, not only is demand seemingly immune from wealth attacks, but so too is supply."
Popular Prime Market
It is these prime markets around the globe which have been experiencing an upturn in interest from property investors and driving the global recovery forward.
Nigel Lewis, a property analyst at PrimeLocation.com, commented on the phenomenon, stating that the current market conditions in the UK were a far cry from the dark days seen in the middle of 2008 when significant reductions characterised the worldwide markets. "Our research shows that the number of 1 million GBP homes for sale has risen considerably [in the UK] over the past year and the number of people looking to buy them has also jumped by 20 per cent - so it's no wonder that the prime property market is recovering so fast," he added.
Global Market Recovery
Indeed, prime markets all over the world have been enjoying an increase in the level of activity surrounding them, with high-end buyers looking to add luxury real estate to their portfolios.
Earlier this year, Singapore was named as being home to one of the fastest-growing and strongest property markets worldwide. Global Property Guide's worldwide investment analysis showed that Singapore's house prices increased by 23.88 per cent year-on-year during the first quarter of 2010.
But it is the high-end section of the market which is now likely to start leading the way when it comes to further property growth, with one strategist at Swiss bank UBS claiming that it will witness growth of between five and eight per cent in its luxury sector in the coming months.
Meanwhile, confidence is also beginning to return among investors.
According to a Worldwide Property Group survey, 68 per cent of individuals questioned believe that now is a good time to begin purchasing property worldwide, with a large majority of those asked looking to use real estate as their primary investment vehicle. Global housing market recovery has begun and with it comes the opportunity for individuals to make a sizable return on investment
when it comes to buying and selling properties.
- Tuesday 13 July 2010