Why a Lower GBP is great news for International Buyers

With the UK facing a lot of uncertainty due to the energy bills rising , political changes and global recession, the GBP fell in the last quarter of 2023 being at its lowest value in decades.

For international investors however, this presents a great opportunity that should be utilised.

This makes NOW an excellent time to invest in the UK, as international investors are taking advantage of the exchange rates to maximise their investments. Investment in property is always a bankable option because of the markets relative stability compared to other more volatile assets.

Why was the GBP Falling?

Why was the GBP Falling

The exchange rate of the pound at the time of writing is £1 = $1.24 This means a single US dollar is worth 81p. This rate has fallen considerably from the start of last year when the GBP was worth $1.35.

Russia’s invasion of Ukraine has had a major economic effect on the world due to it being a major source of energy. 40% of the EU’s gas comes from Russia so the sanctions placed have impacted energy prices in the UK.

Political unrest and rapidly changing economy policies have also contributed to the fall.

The government has tried to stop this trend in several ways, such as the Bank of England repeatedly increasing interest rates throughout the year to 3.5%.

All of the above factors have caused the Great Britain Pound to drop sharply to some of the lowest levels.

Why is This Good For International Investors?

Why is This Good For International Investors

For international investors the various factors affecting the economic climate are perfect for investing in the UK housing market. They are in the best position to make the most of the current climate.

With the GBP falling, this means investing in USD BASED currencies will get you more for your money compared to in the past.

This means that you can invest less money compared to before the GBP began to fall, making UK investments BETWEEN 12-15% cheaper than usual.

This time will not last though as the UK’s political and economic instability calms down over time returning the GBP to its previous strength.

Unlike other sectors of the UK economy, the housing market has an excellent reputation for being stable thanks to UK property status as a physical asset, which sees growing value over time. The UK has also seen house prices rise at a very fast pace as supply issues have caused stratospheric demand.

Rentals have also been rising at a very fast rate, making buy-to-let a popular investment option. They offer a perfect mix of a monthly rental income to give you passive income, as well as capital appreciation increasing the value of properties over time.

Off plan developments have proven to be a great choice in the present climate, given their lower price point, flexible payment plans and future capital and rental yields. These can take longer to earn returns on, due to the time it takes to be constructed, so investing now means investors will save money compared to when the properties go on the market completed.

If you would like to learn more about the UK property market or begin your journey into investing in UK property, please contact us.

The 3 Best Investment Hotspots in the UK to look out for in 2023

Based on analysis of 2022 along with market forecasts, the Northern Cities are predicted to continue to dominate the best investment hot spots in 2023.

For the best opportunities it is important to look outside of London, the commuter towns of Reading, Staines and Slough and further north towards Birmingham and Manchester.

Within Birmingham, the Digbeth area and Jewellery Quarter, along with properties along Coventry Road are seeing the highest growth.

Within Manchester, Salford and Northern Green Quarter of Manchester City Centre have witnessed strong growth.

We believe that properties within the £350,000 to £500,000 mark will offer the best opportunities in this time. Regardless of the current economic climate, we see an underlying strength in this price bracket as it represents areas undergoing great regeneration and as catchment areas to bringing growing populations. This means higher rental yields and capital gains.

Three such areas are identified as follows:

1. Coventry Road, Birmingham

Birmingham City UK

The £500m expansion plan for Birmingham Airport will be bringing a huge number of jobs and high growth commercial activity both local and foreign to the area making Coventry Road one of the top investment spot for years to come. This is part of the HUB Growth and Infrastructure vision to deliver world -class infrastructure and development needed to power growth across the region. It’s a unique regeneration bringing together a combination of existing, world class assets to create Europe’s best- connected destination for leisure, business and living.

2. Reading, Berkshire

Reading Berkshire UK

Reading is only 22 mins by train and with the Crossrail now open, passengers don’t need to change trains to get across the city. University of Reading is internationally renowned creating a huge footfall in the town, attracting widespread investment as well as job creation. Reading is one of the top places in the UK to do business, beating major locations like Nottingham and Glasgow. It also has the highest wages outside of London.

It has a strong technology sector and holds the top place for the city most likely to grow the most in the next few years.

3. Salford, Manchester

Salford Manchester UK

Rental yields around the Salford area have been very strong for some time now. It is known as a hub for academic and business talent and houses. UK’s Media City which is where all the communication powerhouses have their head offices. With an already tremendous amount development, the city is splendid and exciting to live in. With the £1bn regeneration of Media City, Salford has seen an increasing rental demand and property price boosting the economy.

For information on developments within these regions, please contact us and one of our experienced agents will be in touch shortly.

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