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Uk vs asia for property investment

UK Home Improvement

UK vs Asia for Property Investment

Property investment is often perceived as a profitable venture for preserving wealth, generating passive income and multiplying capital gains over time. However, while real estate is one of the safest asset classes, not all property markets offer the same growth due to factors such as government policies, geopolitical situations, changing demographics and interest rates which can heavily impact the return on investment.

If you are hoping to jump on the property investment bandwagon, read on because we’ll be discussing some of the top cities in the United Kingdom (UK) and Asia that are popular amongst investors and help you decipher which market could have the right opportunity for you.

Property Investment in the UK    

Despite the Brexit chaos that destabilised the UK property market and weakened the sterling, the real estate market continues to see exponential growth of over 50% since 2014, according to the Land Registry House Price Index. 

Currently, the average property price in the UK is estimated at £290,000 (about S$499,000). A detached property would cost as much as £458,066 (about S$788,000), while an average flat is priced at £227,951. Of course, the prices vary between cities and regions.

Reportedly, Singapore investors contributed £9.5 billion (about S$16.3 billion) to the UK’s real estate market in 2022. It is a 120% increase from 2021 due to favourable capital gains and low risk of investment that comes with the strength of the UK currency, transparent regulations and the steady growth of the residential sectors are notable upsides to investing in the UK. 

Furthermore, unlike most of Singapore’s private properties, which are mainly leasehold, the abundance of freehold assets in the UK market does seem a lot more attractive and sustainable for long-term investment.

Best Cities in the UK for Real Estate Investment

London may be the first city that comes to mind when talking about investment, however, there are many hot spots in the UK that are attracting real estate investors. Here are the top 5 cities in the UK that investors are flocking to. 

Cities Average Property Price
Bristol £400,520 (about S$688,830)
Leeds£266,189 (about S$457,802)
Birmingham£264,264 (about S$454,491)
Manchester£284,276 (about S$488,909)
Liverpool£219,235 (about S$377,049)
Note that prices exclude conveyancing, stamp duty and other fees payable by foreign buyers.

Property Investment in Asia

Asia Pacific held 40% of the global real estate market in 2022 and the market value reached a whopping S$2,197.10 billion (SGD) in 2023. The market is expected to grow to S$3,467.20 billion (SGD) by 2032 as more investors are now interested in buying up Asian properties.

Here are 2 top Asian cities with thriving real estate markets despite high inflation, and rising interest rates.

Singapore

Knight Frank’s Asia-Pacific Outlook 2023 Report ranked Singapore amongst the top 20 global destinations that Singapore property investors are interested in when it comes to purchasing a second home. Even British billionaire, James Dyson decided to invest in Singapore’s priciest penthouse for a cool S$73.8 million in 2019.

The average price of a condominium in Singapore is $1,954,778, while landed properties are priced around S$5,367,170. Prices vary with location, lease tenure and size. Most developments in the country are designed and built to meet international standards and have excellent connectivity.

A typical condominium in Singapore would look like The Chuan Park, a new project to be launched in the second half of 2024. It offers convenience and luxury within the 916-unit development. It is close to nature, urban necessities and major transportation nodes. 

Thailand

Thailand’s strategic location in the heart of Southeast Asia made it a popular choice for buyers from Hong Kong, Myanmar, China and Europe. Bangkok and Phuket are some of the favourite spots for investors but also the most expensive places in Thailand to own real estate. 

A new condominium in either of these cities would cost around 200,000 Baht (about S$7,370) per square metre (sqm). This means a 90 sqm condo unit can easily come up to S$678,040, excluding tax and fees.

Like Singapore, Thailand welcomes foreign investment and the real estate transactions tend to face less bureaucracy. Foreign buyers are also allowed to take ownership of landed properties as long as they are willing to invest at least 30 million Baht (about S$1.1 million).

Real Estate Investment in the UK or Asia – Which Is Better

It is hard to pinpoint which cities offer the best returns on real estate investment. As with any type of investment, factors like investment goals, risk tolerance and personal preferences can heavily impact which city might offer better returns in the long run.

The UK and Singapore property markets are known for their stability, transparent legal system, and well-established real estate policies but the high initial investment may be a challenge for investors with tighter budgets.

On the other hand, Thailand real estate investment offers lucrative opportunities for investors, particularly for those interested in the tourism and rental markets. However, the currency risk and title deed issues are not uncommon in Thailand. Investors must conduct thorough due diligence to ensure smooth transaction and final property ownership.

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