Posts with tag: Europe

European Demand for London Rental Properties Continues Despite Brexit

Published On: October 18, 2017 at 8:09 am

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European Demand for London Rental Properties Continues Despite Brexit

European Demand for London Rental Properties Continues Despite Brexit

High levels of European demand for rental properties in London continue to be recorded, despite concerns around the UK’s departure from the EU and the status of European citizens in the country when Brexit finally happens.

The latest figures from rental website Spotahome show that the majority of bookings made for rental properties in London stem from the UK’s European neighbours. The largest number of bookings comes from France, which accounts for 22.2%, followed by Spain, Germany and Italy.

With an estimated 300,000 French citizens currently residing in the UK and the majority of these believed to be based in London, the English capital was recently referred to as France’s “sixth biggest city” by the French president, Emmanuel Macron.

Despite Brexit, the French love affair with London continues. This is demonstrated by the large number of searches and bookings for rental properties in London from the European nation.

Despite strong European demand for British rental properties, the second largest number of bookings made on the site came from the UK – accounting for 11.9% of bookings.

The CEO of Spotahome, Alejandro Artacho, comments: “It is no surprise that the majority of the bookings on the site are from the UK’s European neighbours. London is and always will be a hub that appeals to people from all over the world. It’s great to see that alongside Spotahome being popular with people from overseas, the platform is gaining popularity within the UK, due to it being a far more effective method for finding accommodation.”

Landlords, are you seeing high levels of European demand for your properties? While it is uncertain what will happen to the rights of European citizens when the UK leaves the EU, you can still accept tenants with EU citizenship.

However, please remember that you must check the immigration status of all prospective tenants before letting to them under the Right to Rent scheme. The Home Office has worked with us to create a guide to help you understand the requirements: /home-office-reinforces-landlord-responsibilities-right-rent/

The Best Locations in Europe for Buy-to-Let Investment

Published On: October 3, 2017 at 8:11 am

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Ireland is once again the best European location for buy-to-let investment, shows new research by WorldFirst. This comes as the average UK rental yield drops to 4%, putting the country in the bottom five.

In the latest European Buy-to-Let League Table from WorldFirst, Ireland’s average rental yield rose to 7.08%, from 6.54% in 2016, keeping it at the tip of the list. As Ireland’s economy continues its upwards trajectory, maintaining its spot as one of the fastest growing in the Eurozone, so too does its rental market.

The average rent on a one-bedroom apartment in an Irish city has soared to over £12,000 per year, making it the second most expensive country to rent in the EU, after Luxembourg, which costs city renters over £14,000 a year.

And, while sales prices have seen an increase, they have remained closer to their European counterparts, with the average price of a one-bed apartment in an Irish city costing over £168,000.

The Best Locations in Europe for Buy-to-Let Investment

The Best Locations in Europe for Buy-to-Let Investment

Malta, Portugal, the Netherlands and Slovakia have emerged as the next European hotspots, with yields over 6%. All four countries have relatively low house prices, yet strong rental yields provide an opportunity to earn a decent income.

Meanwhile, the UK’s stuttering rental market is beginning to hit buy-to-let investors, with yields falling from an average of 4.91% to 4% over the past year. WorldFirst’s latest table also comes a year after Stamp Duty changes came into force in the UK, significantly increasing costs for those investing in additional properties.

Also sitting at the bottom of the table are Sweden, Croatia, France and Austria, all providing returns of less than 4% due to high property prices and stagnant rents. Sweden takes the bottom spot for the third time, thanks to its tightly controlled rental market.

For British landlords, the falling pound has led to a significant rise in the cost of purchasing a buy-to-let property, with a one-bed apartment in an Irish city costing over £12,000 more than it would have in 2016, and the same property in Luxembourg more than £25,000 more expensive.

Those who are lucky enough to have purchased a property prior to the recent fall will see returns from their rental income increase by up to 8%, getting £900 more per year for a one-bed apartment in an Irish city.

Commenting on the research, Edward Hardy, the Economist at WorldFirst, says: “The correlation between a country’s housing sector and the health of the wider economy is clear. It may now be the case that the deteriorating dynamics of the UK’s rental market is sounding the alarm for a wider slowdown in residential housing, and thereby broader economic wellbeing.

“While the UK remains in a purgatory-like state between EU membership and Brexit, long-term investment decisions have become increasingly difficult to make, and falling returns for property investors could mark the beginning of the end for one of the UK’s most successful investment avenues of the past 25 years.”

Julian Walker, of Spot Blue International Property, shares his thoughts on the opportunities that abound across the Channel in Europe: “According to research from WorldFirst, Portugal is the third best place to invest in buy-to-let property in Europe, with an average rental yield of 6.43%, and Turkey is the seventh, holding a strong average yield of 5.91%. These yields prove that, despite Brexit, investing outside the UK can bring strong investment returns.

“Portugal’s property market is one of the most bullish in Europe right now, with prices achieving a year-on-year rise of 8% for Q2 [the second quarter of] 2017. Sales by volume were up too, recording a hike of 16% year-on-year, with a total worth of €4.6 billion nationwide for the same three-month period.”

He continues: “Unsurprisingly, Lisbon is driving this growth, with sales in the capital accounting for 48% of the total value of the market. Prices in hotspots in the city have risen by an estimated 30% in the last three years, and are expected to continue at 5% per year for the next five years. Lisbon’s rental market is supported by young professionals and entrepreneurs, both Portuguese and foreign. This is thanks to the city becoming a hub for start-ups, but, in particular, new tech firms, so much so it has been dubbed the San Francisco of Europe.”

He offers his advice on investing in European property: “When buying a property overseas, the exchange rate can make a big difference. Just look at how sterling has fallen almost 20% against the euro since the Brexit decision! But it’s not just sterling which has fallen over the past year. Turkish Lira (TRY) has also weakened considerably since 2016, falling about 18% against the USD and 15.5% against the GBP.”

eMoov Completes its Property-Based Euro 2016 Tournament

Published On: June 29, 2016 at 10:59 am

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With the knockout stages of the Euro 2016 championship in full swing, online estate agent eMoov.co.uk has completed its property-based tournament to reveal the winner.

After previously comparing each team in the group stages – awarding goals for the highest take home salary, lowest property price per square metre, lowest monthly utilities costs and the lowest cost of a monthly gym membership – eMoov has moved onto the last 16 teams in its alternative, property competition.

In the knockout stages, eMoov has removed the criteria for lowest gym membership cost. Goals have been awarded on which country has the higher take home salary, the lower property price and the lower cost of utilities.

The last 16 

Although Poland has a higher take home salary, Romania took the first quarter-final spot with cheaper house prices and bills.

France beat Wales in a tight match to take the second quarter-final place. Although the cost of property per square metre is higher in France (£4,274) than Wales, the team did enough to secure the spot with a higher take home salary (£1,506) and marginally lower monthly bills (£116).

The Czech Republic lost out to one of the smallest nations in the tournament, Iceland, due to its lower take home salary and higher bills. However, the Czech Republic does offer a lower house price, securing them one goal.

eMoov Completes its Property-Based Euro 2016 Tournament

eMoov Completes its Property-Based Euro 2016 Tournament

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Albania secured a quarter-final position over Northern Ireland. With a property price of just £917 per square metre and monthly bills of £41, compared to Northern Ireland’s £79, Albania moves onto the next round.

Despite a take home salary of just £136, Ukraine beat Slovakia with a house price of just £899 and a cost of utilities (£36) almost £100 cheaper than Slovakia.

Sweden started a goal down against Hungary, which has the lower property price. However, it rescued the game with a much higher salary (£1,683 to £383) and utility bills of around £54 cheaper.

Belgium lost out to Turkey due to its property prices being double its competitor’s, as well as a much higher cost of utilities – £105 to Turkey’s £64.

Finally, Russia secured the last quarter-final place against Portugal in one of the tightest games so far. Despite having a lower take home salary (£368) than Portugal (£618), Russia has the lower house prices (£1,206) and beats Portugal with lower utilities (£62).

The quarter-finals

In the first game, Iceland narrowly beat Romania. At £908 per square metre, Romania’s lower house prices put them one nil up. However, with a salary of just £352 to Iceland’s £1,611, the game was tied. With its utilities being just £1 cheaper, Iceland snatches the lead at the last minute.

Sweden came out on top of the host nation, France, with a higher take home salary and lower utility bills (£60), despite a property price (£5,199) of almost £1,000 per square metre more than France.

The Ukraine sent Turkey home with a lower house price and utilities, although Turkey was awarded a goal for a higher take home salary, of £469 – more than three times that of the Ukraine.

Albania knocked Russia out of the competition to secure a place in the semi-finals, beating it on both property prices and utility costs. Russia did manage a goal, however, thanks to its higher take home salary.

The semi-finals

Iceland just fell short of a place in the final, offering a considerably cheaper property price (£2,137) than Sweden, but having a lower take home salary and higher utility costs, giving Sweden a spot in the last game.

In the other semi-final match, Albania also fell short to the Ukraine. The Ukraine’s cheaper house prices and lower utility bills beat Albania’s higher take home salary.

The final

The Ukraine takes on Sweden. At £5,199, the price of property per square metre in Sweden is almost six times that in the Ukraine, giving the Ukrainians an early lead. However, Sweden levelled the game with a take home salary of £1,683 – £1,547 more than the Ukraine. But late into the game, Ukraine took the lead with utility costs of just £36 – £24 cheaper than Sweden’s.

The founder and CEO of eMoov, Russell Quirk, comments: “Forget Ronaldo, Gomez or Pogba, all you need to come out on top of the Euros is an affordable property price, good take home salary and low cost of living – something the Ukraine has across the board.

“Obviously, this knockout stage will look completely different to the world football powers that are likely to dominate the actual Euros, but it does offer a good insight into how countries across Europe match up when it comes to property price and the cost of living.

“What with the outcome of the Brexit vote, we could see masses of remain campaigners flee to remaining EU member states for sanctuary based solely on this research.”

England Wins Euro 2016… In Property Terms

Published On: June 27, 2016 at 10:55 am

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It may not be the favourite team to win the Euro 2016 tournament, but England has won the league in property terms, based on research by TheMoveChannel.com.

The property portal has compared the property markets of the 24 competing countries across three categories: house price growth in the year to the first quarter (Q1) of 2016, using Knight Frank’s Global House Price Index; the number of properties listed for sale on the international site; and demand from investors, measured by the number of enquiries from buyers on TheMoveChannel.com in the 12 months to June 2016.

Combined, these three factors determine how healthy a country’s property market is.

Turkey top for house prices

Turkey came out on top for house prices in Europe. According to Knight Frank’s Global House Price Index, the country has experienced huge house price growth in the year to Q1 2016, of 15.2%, ahead of Sweden’s 12.9% and Austria’s 7.6%.

England Wins Euro 2016... In Property Terms

England Wins Euro 2016… In Property Terms

Turkey has seen the strongest house price growth in the world for the last three consecutive quarters, driven by the country’s rapidly growing population, ongoing infrastructure development and high demand.

Spain leads foreign investment 

Spain was named as the most popular destination in Europe for foreign buyers, attracting the highest number of enquiries on TheMoveChannel.com in the 12 months to 2016.

It is followed by investor favourites such as Portugal, France, Turkey and Italy. Italy was also the country with the most properties listed for sale as of June 2016, ahead of England, Spain, France and Portugal.

The quarter-finals 

TheMoveChannel.com followed the format of the Euros by determining the top performers of each group, before progressing through to the knockout stages of the tournament.

In the quarter-finals, Spain beat Switzerland with the sheer force of buyer demand. England won over Portugal due to stronger house price growth and a higher level of homes for sale. Turkey triumphed over Germany thanks to its unbeatable property price rises, while France flew past Austria with its lifestyle appeal.

Semi-finals

While Spain is the most popular spot in Europe for investors, England beat its neighbour with stronger house price growth (5.3% versus 2.4%) and a higher number of properties for sale.

Although France’s house price growth was low compared to Turkey’s (0.5% versus 15.3%), demand for French property is hard to match, thanks to its record low mortgage rates.

The final – England vs. France

England’s house prices have been accelerating for some time, thanks to a chronic lack of housing supply. In the 12 months to June, prices soared by 5.3% compared to France’s 0.5%. England also boasts more properties for sale, leading to a clear win. However, France did score a consolation goal thanks to a higher level of buyer interest.

How Do House Prices Compare Across the EU Member States?

Published On: June 23, 2016 at 11:20 am

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Ahead of today’s EU referendum, online estate agent eMoov.co.uk has analysed how house prices compare across each of the 28 EU member states.

The agent’s map shows the average price of property per square foot in each state, when they joined the EU and the property price per square foot for each capital city.

The average house price across all EU member states is currently £2,867 per square foot. Where capital cities are concerned, London storms ahead with the most expensive house prices. At £12,468 per square foot, London’s reputation as the most expensive city in the world to buy a house is apparently confirmed, for the EU at least.

Paris is the second most expensive capital city in the EU for property, however, with an average price that is less than half of that in London, it remains significantly cheaper. Stockholm and Rome also rank highly, both home to an average house price of more than £5,000 per square foot.

Dublin is the ninth most expensive capital city, at £3,489 per square foot. Although Belfast, at £2,205, Cardiff, at £1,583, and Glasgow, at £1,580, all lie within the member state of the UK, they rank as the 15th, 20th and 21st most expensive capital cities for property in the EU.

At just £734 per square foot, Sofia, the capital of Bulgaria, has the cheapest house prices of any capital city in the EU member states.

Although London is the driving force of the UK property market and the most expensive capital city in the EU for house prices, the same cannot be said for the UK as a whole.

At £3,279 per square foot, the UK is only the fourth most expensive EU member state. The top three spots go to Luxembourg, at £4,540, Sweden, at £3,991, and France, at £3,423.

House prices across each EU member state

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In line with its capital, Bulgaria is also the cheapest EU member state for property overall, at just £634 per square foot. This is also the case for Romania and its capital Bucharest, and Hungary and Budapest as the second and third cheapest member states for house prices.

How Do House Prices Compare Across the EU Member States?

How Do House Prices Compare Across the EU Member States?

Although there seems to be no strong correlation between the time a country has been an EU member state and the price of property, there are 15 member states that joined prior to the year 2000. Of these, 13 account for the highest property prices in the EU, with just Portugal and Greece home to an average house price of less than £1,600 per square foot.

The founder and CEO of eMoov, Russell Quirk, comments on the findings: “The UK property market and the influence a Brexit could potentially have has been a big talking point and arguably so, as for the average UK homeowner, their property is the most expensive asset they are likely to own.

“This research isn’t an attempt to sway people either way, simply to show the strength of the UK market against the rest of the EU, but also to highlight that despite the London bubble, there are other areas across Europe where prices outperform that of the UK.”

He continues: “Will property prices drop if we vote to leave? No one really knows for sure, and any potential impact will take a while to come to fruition. Should we vote to leave, any real impact wouldn’t become clear until 2017, and prices could potentially flatten and even go into reverse, which would be a mammoth event given the years of steady upward growth.

“It all comes down to confidence in the market, and whilst the media and campaigners from both sides continue to scaremonger, the seesaw remains finely balanced. A few gloomy headlines and people will understandably sit tight and play it out. However, this lack of investment and activity in the residential market will prompt a fall in buyer demand and this is what will result in a drop in property prices.”

However, he adds: “This said, with the precarious mix of easily obtained credit and inflated property prices continuing to inflate the UK property bubble, something will eventually give, Brexit or no Brexit. I for one think that a cool in demand caused by uncertainty in the market, be it as a result of a leave or remain outcome, could be a healthy thing and help return the UK market back to some level of stability.”

London No Longer in Top 10 European Cities for Property Investment

Published On: January 16, 2016 at 5:50 pm

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London has fallen out of the top ten best cities in Europe for property investment for the first time since 2012. It is now in 15th place, due to high house prices and a clampdown on yields.

London No Longer in Top 10 European Cities for Property Investment

London No Longer in Top 10 European Cities for Property Investment

The top spot was claimed by Berlin, followed by Hamburg, in the Emerging Trends in Real Estate report from PwC and the Urban Land Institute (ULI). The only British city to appear in the top ten is Birmingham.

The report explains which areas experts believe will be prosperous for property investors. It interviews over 500 developers, investors and property managers within Europe.

These industry experts were asked to rate each city based on investment prospects and their effects on the future of the property market, for both the residential and commercial sectors.

Although London is still the largest investment market for property in Europe, it sits one place behind Istanbul and two below Budapest – despite unstable political situations in both areas.

The Chief Executive of ULI Europe, Lisette van Doorn, explains that Istanbul’s popularity is due to its fast growing population, which creates huge opportunity for investors.

The report assesses intentions of investors, rather than whether actual capital is heading to those markets.

It suggests that London is still the first choice for investors hoping to preserve their wealth.

The Director of Real Estate at PwC, Gareth Lewis, explains: “London is the largest real estate market in Europe. Money tends to plough into it during the harder times, as people are looking for a safe bet, somewhere to keep their money, and as prices go up and yields compress, people looking for better rewards will look to secondary cities.

“And that’s when you see cities like London slide out of the top ten. It’s not a long-term damning of the London market by any stretch of the imagination. It’s just a reflection of where we are in the cycle.”1

However, one investor claims: “Suddenly everybody is beginning to look to sell. The theory is that the smart Americans are taking their chips off the table and are now looking more to mainland Europe and in particular, parts of Germany and southern Europe, to deploy capital in 2016. The big test for London is how much of this stock will be mopped up.”1 

European cities with the best property investment prospects

Position

City

1 Berlin
2 Hamburg
3 Dublin
4 Madrid
5 Copenhagen
6 Birmingham
7 Lisbon
8 Milan
9 Amsterdam
10 Munich
11 Stockholm
12 Barcelona
13 Budapest
14 Istanbul
15 London
16 Helsinki
17 Warsaw
18 Edinburgh
19 Prague
20 Frankfurt
21 Brussels
22 Paris
23 Vienna
24 Zurich
25 Rome
26 Lyon
27 Athens
28 Moscow

Birmingham remained in sixth place for the second year running, due to companies starting to move their business there, such as HSBC, the HS2 rail service and its low cost in comparison to London.

One investor states: “I think it is finally proven that Birmingham is attracting employees and employers from London. At several buildings in Birmingham which we own, the tenants have moved people there because it is cheaper.”1

It is believed that Berlin’s popularity stems from its status as a hub for creative and tech industries, and its high demand for office space.

An international investor says: “All the creative industries are going there; it has got a multitude of different tenant types; it’s dynamic; and it has got new infrastructure coming.”

Another adds: “There is a move from the traditional main driver of take up, the public sector, to IT and tech, which is driving rents. It has a young international employee base and a lower cost of living, which is driving the city forward.”1 

The third most active property market in Europe, Paris, was only 22nd on the list of 28 cities.

An interviewee claims the city is “too expensive” and has problems with “political instability”1, while another advises investors to “approach Paris with caution”1.

One trend that the report highlights is the future growth in private rental apartments and other residential investments in London.

Van Doorn says: “We see almost all types of players getting involved, if they are not already, in residential. That is not only in the UK, but across Europe.

“There is an influx of international investment, such as American institutions which are coming into the market of student accommodation. They were seen as alternative assets, and some still are, but they are accepted now as being in the spotlight for the bigger institution lender.

“I think residential is becoming really mainstream as a class, all of it, including retirement living, student housing.”1

Another important theme that the report emphasises is sustainability and the environment.

The ULI’s Peter Walker states: “It’s clear from the interviews that this is now just part of mainstream language of business in real estate, and it’s not seen as this emerging fad anymore – it’s seen as a core business theme for many.”1

1 http://www.pwc.com/gx/en/industries/financial-services/asset-management/emerging-trends-real-estate/europe-2016.html