Despite the taxation changes during the year, the UK remains a top spot to invest in housing. The total value of the UK housing stock has passed the £6 trillion mark for the first time, according to research by Halifax. Not surprisingly, most of this wealth is in London and the South-East. In fact, the value of homes in London is more than all the houses in the north of England, Scotland and Wales together. According to the research, the stock of privately-owned houses in Britain has gone up from 21.5 million to 23.4 million, with 68% of private property wealth – £3.8 trillion – being in the south.
According to the Halifax, the biggest gainers of this wealth in the south are landlords and second-home owners. The over-55s own much of this housing wealth, with 63.3% of the market. Under-35s own just 3.3%, with this trend set to continue as housing prices increase far faster than wages. This is particularly the case in London, where far more people are renting in areas where house prices are at their highest.
That said, Scotland is currently the best place to invest in rental properties, as rental price growth is outstripping the rest of the UK. The average rent is up 2.5% in October compared to the previous year, according to the Your Move buy-to-let index. The average property rent per month is £572 compared to £845 in the south of England. Growth in Scotland was highest in the Highlands & Islands region, where prices are 6.4% higher than the previous year, with an average rent of £613 a month. The most expensive Scottish regions are Edinburgh & Lothians, with an average monthly rent of £669. According to Your Move, Scottish landlords enjoy a 4.8% yield on average, compared to an average of 4.4% in October across England and Wales.
International investors are also returning to the UK, according to a Liquid Expat Mortgages report, claiming a 20% rise this year in expats and foreign nationals from the United Arab Emirates buying property in the UK. They are mostly looking outside London and the South-East, in areas where property values are lower and rental yields are higher. The weak pound is one major attraction, as well as a wide selection of mortgages targeting expats and foreign nationals offering interesting rates as low as 2.74%. Liquid Expat Mortgages managing director, Stuart Marshall, said the UK remains one of the best places to buy property in the world.
Try InventoryBase for free today.