Posted by
iwill
11 yrs ago
Hey all,
I'm just wanting to get your thoughts about UK prop investment. I'm HK based, but have friends in the UK who are saying it is again becoming a good market for investment.
Your thoughts/experiences would be appreciated!
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It's a no go.
UK Builders lead UK Property prices, and they seem to have begun a major correction, as rates rise.
And prices are not cheap at all, especially in London.
If I was going to invest in the UK, it would probably not be in expensive London property, despite all the pricey marketing done here in Hong Kong.
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iwill
11 yrs ago
You're definitely right about it not being cheap, but from what I have read and been told, if you look to areas other than London, prices aren't as expensive and the demand for prop at the moment is so high that capital growth can only be expected, I guess at what rate, no one knows.
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"demand for prop at the moment is so high that capital growth can only be expected"
???
Is that logical?
You might also say: High demand has pushed prices to unrealistic levels.
I don't think "because other people are enthusiastic" is an adequate reason for investing in a long term illiquid asset as property is.
If you invest outside London, I would suggest places with good transport links (rail, airport, perhaps highways.)
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iwill
11 yrs ago
From my understanding, rather than demand being pushed by enthusiasm, its actually being pushed because there is a real shortage of housing. Which is creating a massive amount of new developments, I guess this links back to your point about builders setting prices.
Also, the UK government has just released a number of schemes to help home buyers. I would have thought such schemes would only increase sales and consequently fuel capital growth?
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Haha.
Do you think so? That sounds like what the agents are saying.
Look at Rent rises, and that may tell you a great deal about end user demand.
For the moment, new property prices (especially in London) are being pushed by foreigners buying - and also by the Help-To-Buy scheme, which was designed by the Tories to push prices up, and get them re-elected.
The really interesting thing is, with the HTB program, prices "should" be moving up, but they market is still reliant on foreigners. And UK Homebuilder share prices have been falling. When a price rise should happen, based on news, and it does not - I take it as a real warning sign.
Barratt stock chart:
http://img819.imageshack.us/img819/9572/yls.gif
Of course, I can be wrong*, and the agents could be right that it is a wonderful time to buy. It is up to you to decide which facts you find most compelling.
== ==
*(Some here may tell you that I have been too bearish on London property, and that may still be the case.)
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(Duplicate post, from Main HK property thread):
Hong Kong Agents will not sit still for this slowdown !
They are non-plussed about the dropoff in their business volume,
so here is what they will do as a protest:
On Monday they are pulling their advertising from newspaper - and this way they will "share the pain" with the media.
(Probably, we will see many new ads for Foreign Properties - be careful about getting sucked in !
The charts tell me that UK property may be at a dangerous juncture...)
BDEV Chart : http://img266.imageshack.us/img266/8308/g6.gif
Comments- : http://www.greenenergyinvestors.com/index.php?showtopic=17414&st=40
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