Foreign Investors: Are They Good Or Bad For Property?

Brett Alegre-Wood
November 3, 2020

Foreign Investors support the Market during tough times

Foreign Investors saved the bacon last recession, they do play a part in supporting the property industry.

Let's talk about Overseas Investors, in our business about 40% of our clients are actually overseas investors. They come from primarily Singapore, Hong Kong, Malaysia, the Middle East and they're the sort of two hot beds if you like but we also have Vietnam, Thailand and a few things like that but really Asians and the Middle East if you like the two sort of areas that we're big in. We market there and we do that sort of stuff.

Now the question is, are they actually gonna help us? Interestingly you know Asian investors spend 700 million on London Real Estate H1 2020. London's still the biggest draw but where else rich Chinese investors are buying? where else are they? It's interesting because when you look you know the GCC you know the Gulf Coast basically all these investors are being drawn to London because it is a world city and to be fair it's a fantastic place and you know what we used to say New York we used to say you know America the foreign investment there.

But you know what, that's dropped under Trump and Trump really has said make America great screw the rest of the world, and you know what they've responded and said screw you Trump. Will that change who knows but the interesting thing is the foreign investment is drying up everywhere. It's not just in the US but to be fair it's made it harder for London, there's no doubt London and UK and understand when I talk about foreign investment I'm not just talking about London nowadays I'm talking about London, Manchester, Birmingham even Liverpool you know even Leeds. Some of these places you know they really are starting to now you know get some really good things happening. 

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It's a very different market in Scotland, it's a smaller market. There's some fundamental changes namely oil and gas with all the issues there and that I know Aberdeen and a few of those places house prices have dropped considerably. So, it depends on how that's reacted.

Certainly Birmingham, Manchester and London are world cities now without a doubt. The key things here for me is that you know Overseas Investors saved our bacon in the last recession because what happened when the recession hit nobody could get financing.

It was really difficult and so international investors came in and they supported those house prices. Yes, you can say well, actually you know what I don't like that I don't want them to do that. I want house prices to drop so I can get them cheaper okay there's a total argument for that and I get it. 

What I'd love to know, have that discussion in the actual comments. Foreign investors, is it good or bad? what do you think? Because realistically London is a world city now in terms of everyone moving there, from all different nationalities Manchester, Birmingham they're all that way now. You can say well actually this market is just for locals but what is a local in London these days I mean you know I’m Aussie and in fact in our London office I think there's a few times where we haven't employed any English whatsoever any Native English.

I don't know how you explain it.  That's not changing either the world is becoming a much bigger place and I know when I go back to Australia now, Chinese, Indian you know they've really started to come on. I mean let's face it they're a third of the world's population and more you know now they've started to jump on planes and go out and live in other countries and we're starting to see that cultural diversity and coming around. 

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Is it good for property look I think from a house price supportive perspective yes it is great because if the locals can't lend and the local companies are making it hard lenders are making it hard then the internationals will get in there and help out. That's quite good from that perspective. The whole politics about you know rising prices and you know increasing demand that's another story.

Video Transcription

Let's talk about Overseas Investors, in our business about 40% of our clients are actually overseas investors. They come from primarily Singapore, Hong Kong, Malaysia, the Middle East and they're the sort of two hot beds if you like but we also have Vietnam, Thailand and a few things like that but really Asians and the Middle East if you like the two sort of areas that we're big in. We market there and we do that sort of stuff. Now the question is, are they actually gonna help us? Interestingly you know Asian investors spend 700 million on London Real Estate H1 2020. London's still the biggest draw but where else rich Chinese investors are buying? where else are they? It's interesting because when you look you know the GCC you know the Gulf Coast basically all these investors are being drawn to London because it is a world city and to be fair it's a fantastic place and you know what we used to say New York we used to say you know America the foreign investment there. But you know what, that's dropped under Trump and Trump really has said make America great screw the rest of the world, and you know what they've responded and said screw you Trump. Will that change who knows but the interesting thing is the foreign investment is drying up everywhere. It's not just in the US but to be fair it's made it harder for London, there's no doubt London and UK and understand when I talk about foreign investment I'm not just talking about London nowadays I'm talking about London, Manchester, Birmingham even Liverpool you know even Leeds. Some of these places you know they really are starting to now you know get some really good things happening. Certainly Birmingham, Manchester and London are world cities now without a doubt. The key things here for me is that you know Overseas Investors saved our bacon in the last recession because what happened when the recession hit nobody could get financing. It was really difficult and so international investors came in and they supported those house prices. Yes, you can say well, actually you know what I don't like that I don't want them to do that. I want house prices to drop so I can get them cheaper okay there's a total argument for that and I get it. What I'd love to know, have that discussion in the actual comments. Foreign investors, is it good or bad? what do you think? Because realistically London is a world city now in terms of everyone moving there, from all different nationalities Manchester, Birmingham they're all that way now. You can say well actually this market is just for locals but what is a local in London these days I mean you know I’m Aussie and in fact in our London office I think there's a few times where we haven't employed any English whatsoever any Native English. I don't know how you explain it.  That's not changing either the world is becoming a much bigger place and I know when I go back to Australia now, Chinese, Indian you know they've really started to come on. I mean let's face it they're a third of the world's population and more you know now they've started to jump on planes and go out and live in other countries and we're starting to see that cultural diversity and coming around. Is it good for property look I think from a house price supportive perspective yes it is great because if the locals can't lend and the local companies are making it hard lenders are making it hard then the internationals will get in there and help out. That's quite good from that perspective. The whole politics about you know rising prices and you know increasing demand that's another story.


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