The UK's real estate market should still hold appeal to Gulf-based real estate investors despite the uncertainties surrounding Brexit, according to Savills.
Despite growing by just 2.7 percent in 2018 as Brexit fears slowed the market, the total value of UK housing stock increased £190 billion to hit a record £7.29 trillion, according to new analysis from the real estate adviser.
Steven Morgan, CEO of Savills in the Middle East, said: “For those holding dollar-denominated funds, there is an opportunity to look at the UK as a place to invest in real estate.
"Despite some of the uncertainty surrounding Brexit, there remains value in the British market for Middle East based investors. Traditionally money from this region has been invested into the globally significant areas of London and as a long-term investment that remains solid advice, but there are also many regional parts of the UK which should be considered.”
The statement comes as the British parliament holds a historic vote later on Tuesday on the Brexit deal agreed with the EU and all sides are bracing for turmoil when the text is almost certainly rejected.
With just over two months to go until the scheduled Brexit date of March 29, a bitterly divided Britain is in limbo and the world is on tenterhooks about what will happen next.
Savills said that reversing a decade-long trend, gains came from the regional markets as London’s residential stock recorded a 1.5 percent fall, the first since 2009, in the face of stretched affordability and broader economic uncertainty.
Despite slowing growth in London, it still accounts for almost a quarter of UK housing value, compared to a fifth a decade ago. London’s housing stock is worth £1.77 trillion, over four times the combined value of Birmingham, Manchester, Edinburgh, Glasgow, Cardiff, Bristol, Liverpool, and Sheffield - all cities which saw higher rates of price growth than the capital in 2018.
Savills said last month that Middle Eastern investment in London is expected to top £1.38 billion ($1.75 billion) in 2018, up 30 percent on last year's activity.
Across the UK as a whole, price appreciation added a total £138 billion, equivalent to growth of £4,800 per home, Savills said.
“Our analysis demonstrates the scale of the housing market and underlines the importance of housing to the economies of London and the UK as a whole, both as an asset class and store of private wealth,” said Lawrence Bowles, residential research analyst at Savills.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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