Keep looking North! Opportunities in UK residential property

Has the appetite for UK residential property returned after the extremely bumpy ride of the last few years? Well, from speaking to a number of our UK and overseas clients, the answer is “absolutely”.

Back after a two year hiatus…

In fact, according to figures recently released by the Investment Management Association (IMA) sales of property to funds soared in October 2009, making property the most popular asset class for the first time in more than two years. Investors are being tempted back into the UK residential property by the recent economic recovery and the recent increases in value of UK property.

What´s up north then?

That’s all well and good but is it the right time to go back in and invest in UK residential property and where am I going to see real returns on my investment? London and the South, the Midlands, the North? Where is the real ‘value’ to be secured in residential property? Well, after careful study of recent buyer transactions, house price movements and various economic trends, we have targeted sourcing quality, high yielding, off market property in areas that have proven to return solid long term growth prospects in the city centres of Birmingham, Manchester and Liverpool.

Booming Birmingham

So, why these city centres and not others? Let’s take a look at Birmingham for example. Situated in the heart of England, it is the UK’s second city; it is a centre for leisure, wide ranging culture, internationally renowned shopping, major events and exhibitions, world class sport, vibrant nightlife and a thriving financial sector. It is at the centre of the country’s road and motorway network, has three mainline rail stations and its own airport. With a strong business and student community, coupled with our quality investment product it all stacks up! We have formed strong long term relationships with some leading developers in these cities and look forward to releasing details of new projects to you very soon.

Is the UK fairly valued? We think so.

But does the UK residential property market offer fairly valued residential property? We think so. Two main reasons why. There is a clear lack of supply of residential stock in relation to the demand and the recent super low interest rates are propping up prices. So certainly in the short term there is good value here. In the long term supply will inevitably increase and as the economy normalises, rates will rise making now the best time ever to invest in UK residential property…… at least in the three city centre areas we’ve just highlighted.

Latest from London

As for London, it has seen continuous inward investment at the top of the market, where there has been a flurry of transactions in ‘super prime’ central London property from foreign buyers looking to take advantage of the weak pound. There are opportunities in London but only for those that have large deposits, so able to secure favorable borrowing. We feel prices are clearly inflated still and will continue to only go one way offering very little value to most investors.

I will continue to monitor and gage the movements in the UK residential market and off course provide you with details of our latest discounted, off market investment opportunities.

Until then, all the very best,

Regards,

Andy

Torcana UK Director

andy@torcana.com

Tags: Andy Kiwanuka, Birmingham Property, House price statistics, Investment Management Association, Liverpool Property, Manchester Property, Torcana, UK Property
Posted in UK Property |

After England rugby’s desperately poor recent form in this year’s 6 Nations cup, we are all wondering where glimmers of hope and better sporting days will come from to lift our spirits. Who knows, with Rooney’s current electrifying form, that day may be here sooner than we think against Egypt, (the Africa Nations cup champions) on Wednesday evening. However, in the meantime, some bright lights of hope (no more green shoots please) appear to be starting to shine again on the UK commercial property sector this year.

2010, and in particular the last 4 weeks, has seen a quite remarkable welcome return of not only confidence but also the buyers and investors to the UK commercial property market ……..and plenty of them! In fact, our strong network of sourcing partners, developers and financial institutions have never been busier and continue to locate and put forward off-market deals to meet this growing demand for strong yielding, commercial property. What a difference a year makes, I hear you say!

So what commercial investments are in greatest demand from these buyers and investors?

Put simply, ‘anything and everything’ that can deliver strong yields, has a solid anchor tenant on a long lease and is in ‘prime’ central London or the surrounding area. Tenanted offices and retail outlets in central London and logistical sites along the M4 corridor seem to be the most common requests.

In fact, the ideal is the following; we recently sourced and sold a 10,000 sq ft tenanted office property on Sackville Street in the heart of Mayfair. The property had a strong anchor tenant, (HQ for a large firm of European tax consultants), on a 10 year+ lease yielding over 6.0%. The deal exchanged and completed within 28 days which is every consultants dream. Safe to say both our buyer and seller were extremely happy too. Mind you by the time of exchange my colleagues had been approached by more than a couple of dozen other buyers wanting to view and bid for the same property.

We continue to try to source this holy grail of similar ‘off market’ London commercial investment opportunities.

Next week I will take a closer look at whether the same can be said for the UK residential investment market. Is the buyer confidence returning here as fast? Where is the current interest? Which UK locations offer the same value and how is it measured?

Well, until next week, good luck Rooney, keep smiling Martin Johnson and here’s to the continued growth in investor confidence and activity in the UK commercial property market.

All comments welcome

Best Regards

Andy Kiwanuka
Torcana UK Ltd

Tags: Andy Kiwanuka, High Yield UK Property, London Commercial Property, Torcana UK, UK Commercial Property
Posted in UK Property |