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SA wealthy buying more property in London than the Swiss, Singaporeans and Saudi’s

A new report into foreign buyers of London property reveals that wealthy South Africans are the 11th most active nationality in the £1m+ property segment.

The report released by global property consultancy Knight Frank LLP, shows that South African buyers outperformed buyers from far wealthier countries such as Germany, Singapore, Saudi Arabia, Switzerland and Canada over the past 3 years.

“This news comes as little surprise” says Mike Smuts, managing director of Smuts & Taylor Ltd. His firm, with offices in London and Cape Town, specializes in assisting wealthy South African investors enter the London property market.

“Wealthy South Africans are highly sensible with their investments and are looking at London property as a “Safe-haven” amidst the weak domestic economic outlook and continuing uncertainty about the timing of the global economic recovery. London bricks and mortar is fast becoming the new Swiss Bank account”

Surprising enough, Mike says, the vast majority of his wealthy clients has no intention to formally immigrate but is rather making use of the greatly relaxed foreign exchange regulations to migrate a portion of their wealth to a stable economy with a strong currency, such as the UK.

Both property prices and rental values have risen sharply in recent years leading to a healthy return – prime central London house prices have risen 49% since March 2009 and are now 14% higher than their previous market peak of March 2008.

London’s population growth is the fastest in the UK, yet new houses are being constructed at a far slower rate. The government estimates a rise in household numbers in London of between 34,000 and 38,000 annually up to 2028. But based on development levels over the last decade, a realistic estimate of the number of homes which will actually be delivered each year is 21,000.

Says Smuts: “For some time now, the Prime Central London residential market has seemingly defied the laws of gravity. Whilst the rest of the UK, Europe and the United States are generally showing, at best, weak economic growth, the Central London market is booming and savvy South African investors have definitely benefited alongside their more publicized counterparts from Russia, India, Italy, the US and France.”




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