The fall in the value of Sterling has made UK investments value for money, which set alongside the mature and fair legal systems and relative social and economic stability, has made the UK an attractive destination for foreign funds and high net worth.
The drop off in the flow of overseas money has been more predominant from the east side of the globe, whilst the US still show interest in UK assets.
Through various different means, there is an increasing focus on ascertaining data on who actually owns land in the UK, with focus on ascertaining beneficial ownership, not just knowledge of the holding entity. Clear visibility on this would make interesting reading.
But then let's remember before we get too caught up on this, that for most of us with private pensions, a large share of our investments are in overseas markets, much of which will include overseas real estate assets. The flow of money isn’t just one way.
One of the challenges however for agents trying to pull together real estate deals is how best to market for best interest. Best is not necessary the widest pool of interest, nor the highest bid, but it is a bid from a buyer who has both the appetite and the funds to perform. For that reason, over the last few years, as well as compliance with regulations around Money Laundering and Proceeds of Crime, there have been many assets traded off market, or with interest sought from only a small pool of potential buyers. However where overseas investment is concerned, certainly in some markets, the interest can come from such a wide range of parties, it makes it difficult to determine which ponds to fish in to achieve the 'best' bid.
We have ourselves seen assets bought and sold to overseas government and public bodies, pension funds and high net worth individuals from Korea, China, Singapore, the US and South America, not to mention the dominant German funds and other European countries investing in the UK. The ease with which funds can be transferred but the complexity of the regulatory requirements around spend can be daunting, but less so than the concerns when there is no market. As we approach (or look back on) the 10th anniversary of the crash (politely referred to as the last price correction period) there is a looming sense that the time is nigh for another one, leaving aside even ignoring the short term period of uncertainty around Brexit. The price of Sterling may still bring opportunities and buyers we’d never think of approaching for an off market deal, but I share the view that the UK still offers a mature, safe environment for investing. Whilst we seek to quietly have our own investments placed overseas, let's hope that overseas still sees value in UK real estate and bargains to be had, amongst others, north of the border.
