Property News

Russians Still Active in the UK

Russians Still Active in the UK
Global property and consultancy agency Knight Frank reported that Middle East investors made up more than 15 percent of London’s super-prime real estate market from years 2010 to 2012, according to Arabian Business.

However, the study showed that UK, comprising 33 percent and Russia, comprising 18.7 percent were more active participants in the £10m-plus property sector than the Arabs.

Seen to set the trend on overseas investors is UK’s projected “Mansion Tax” in which some wealthy Arab buyers who bought UK houses are expected to pay an annual fee as much as £140,000 ($222,466).

It was also reported that a lot of Arab owners will be greatly affected by the ruling once it takes effect next year since most of them buy UK property through holding companies.

Although 88 percent of advisers: tax accountants and lawyers see UK’s shifting tax environment as the weakest point hindering buyers to invest in the UK real estate, 87 percent on the other hand, said that they can wait for the result of the consultation on the proposed changes. 67 percent remarked that there is a possibility of them looking to transfer ownership to a trust.

The Knight Frank report also showed 50 percent of surveyed participants said that they are looking to transferring ownership to an individual and 27 percent to a partnership.

The wealthy have looked up to London as the safest haven in the globe against geopolitical uprisings and economic crises have become rampant, this suggests that geopolitical and security concerns are the main factors to key in positive impacts to those who are planning to buy or rent property in London.

Knight Frank said that an increase of 9.4 percent in the UK market was recorded over the 12 months till August, but was tainted by a slowing growth rate.

“With international buyers representing an increasingly important source of demand in the market, we asked respondents which nationalities they thought would become more prevalent. The most frequently mentioned were buyers from Russia and the CIS, China, Middle East, France, India and Africa,” the report said.

Adding that, “Looking to the future, our view is that price trends are likely to remain fairly subdued over the next 12 to 18 months. We have set our forecast for zero percent growth in 2013, with a return to positive growth from 2014 and beyond.”