Foreign investors eye up repossessed UK homes

Published 28th Oct 2009

European buyers are going online in search of chain-free homes and other property bargains


Investors from overseas are eyeing up repossessed homes in the UK, with German and French buyers at the head of the queue, according to data from property website PropertyEarth.

The site, which specialises in chain-free properties including lender repossessions and developer's unsold stock, said it had attracted visits from investors all around the world drawn by the price of property and the weak pound.

PropertyEarth's managing director, Dominic Toller, said overseas buyers saw the UK as a good place for a long-term property investment. "PropertyEarth has even had interest from large investment funds and high net worth international buyers who want to purchase entire blocks of flats," he said.

PropertyEarth's data, based on the number and length of visits to its website, reveals a steady growth in interest from international visitors is primarily coming from Europe, with investors from Germany and France making up a third of all European visitors, split 17.7% and 15.3% respectively, followed by those from Spain (14.7%), Ireland (10%) and the Netherlands (8.9%).

Toller, who claims investors are earning an average return of 6.59% on chain-free properties, attributed the high interest from German and French investors to a rise in consumer confidence following recent official announcements that both countries have emerged from recession, and the continued strength of the euro against the pound.

"As Germany's property market has remained fairly resilient against the recession, German investors are looking elsewhere for property bargains," he added.

Increased interest from Spain is largely due to the Spanish recession and the fall in sterling's value, leading expats to return to Britain, he said. People that sold their Spanish homes at much reduced prices could be searching the UK's distressed property market for an opportunity to buy back in at an affordable level.

But it is not only Europeans that are looking to bag a UK bargain. Toller said the continued strength of the dollar against the pound has led US property investors, who make up almost 15% of all international visitors to PropertyEarth, to consider Britain an investment opportunity that is likely to recover more quickly than their home market.

However, rival property website Rightmove, which lists properties being sold through estate agents, said it had seen little extra interest from would-be buyers in France and and Germany.

It said searches originating in Germany had increased by about 38,000 a day in the 12 months to September, while traffic from France had increased by about 23,000 visits a day, which is in line with the increase in its market share.

A spokesperson said: "The US provides Rightmove with over twice the level of traffic as Germany does. I also notice that Property Earth hasn't included Russian traffic. It can be tricky to accurately measure data from Russia. However, we would imagine there to be an increase in traffic numbers from there."

Source: ' Guardian '

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