Sunshine landlords – Investing in bricks and mortar abroad

With the popularity of overseas property TV programmes it seems that a number of UK investors are looking towards the sunshine to expand their property portfolio. The Property Investor Show, which comes to the NEC Birmingham next weekend, showcases a wide choice of investment opportunities from the UK as well as abroad.

One such overseas opportunity is with Monopoly Realty Holdings based in South Australia – the only Australian state Britain retained as a free-settler province rather than a convict settlement 170 years ago. With Adelaide at its centre, the region is known as a state of fine wine and festivals and of course great weather.

“The official rental property vacancy rates in South Australia are now hovering between 0.5% and 1%, team this with the British pound providing excellent exchange values, many UK investors like the prospects of an Aussie residential investment,” explained Ben Howard, Director. “The average weekly rent for a three bedroom house in South Australia has increased by 7.9% over the last 12 months, this doesn’t look set to change and in fact industry experts are predicting that rents could increase by a further 20% over the next three months. This is obviously attracting savvy Brits.”

One UK investor who has bought in Australia was attracted by price, quality and the fact that his rental income was guaranteed for three years. “You would think that buying so far from the UK would be problematic but we had a very smooth transaction between agreeing the purchase and its recent completion.”

A more traditional location for investment is the beautiful and romantic countryside of Italy. For many years the hills of Tuscany and Umbria have attracted the British investor and holiday maker. With ease of access and the promise of excellent food and wine it’s not hard to see why these regions attract many of us year on year. But House Around Italy has a secret – the new Tuscany!

Abruzzo runs along the Adriatic coast of Italy directly East and only one and a half hours from Rome, with its sparkling warm seas on one side and mountains along the other. On certain days you can ski in the morning and swim in the sea in the afternoon. Proven to be 50% and 80% cheaper than its more well known neighbours, Umbria and Tuscany respectively, and with daily flights from London into its own airport Pescara it should definitely turn a few heads.

Nikki Di Girolamo from House Around Italy explains the opportunities for UK investors, “There are 1500 properties available in Abruzzo, there is something for everyone, from ruins at £7000 to castles over a million pounds. We have a wide range of properties in this beautiful region. From Castles to more modest opportunities for as little as €14 thousand euros.” In fact on its books currently are 12 castles, 90 properties over €one million and 350 under £40,000. “There is so much going for this region it makes a sound investment, added to which is the fact that for five years in Italy you pay no Capital Gains tax. For a British investor this could mean a return of between 100-150%.”

Emerging as a strong player in overseas investment is Bulgaria – yet it still remains affordable and offers a wide range of locations from sea to snow and properties from detached villas, marine frontage or ski chalets with starting prices from £35,000.

Robin Barrasford, Managing Director for Barrasford and Bird Worldwide and member of the Association of International Property Professionals is a widely respected expert on emerging markets. “Bulgaria shares many of the desirable traits of its more established neighbours and with low coast airlines already flying direct to the capital Sofia and coastal areas it’s difficult to see how it differs greatly from Spain,” commented Mr Barrasford. “However, Bulgaria offers property at a fraction of the cost, only becoming an investment hotspot in the last few years.”

To invest in property you need to be sure that you’re going to get a return and for that reason investors are purchasing off-plan properties in Pamporovo or Sunny Beach. With the addition of a new terminal at Sofia International Airport and a new Sofia Business Park the evidence of progress and growing confidence in Bulgaria’s capital is also proving an investor hotspot.

Investors who are keen to beat the rush and buy in future hotspots should take note from Mr Barrasford, “it’s difficult to pin down the next big thing, markets such as Malaysia are hot at the moment with an established holiday market and attractive returns; similarly Brazil seems to be the buzz word, with a development of ours already having flown off the shelf. But it can be easy to purchase the cheapest property on the market in the hope that you ‘can’t go wrong’; the old adage ‘invest money to make money’ rings true and buying a property in a good location will always return profits.”

It seems that location is still the key to strong investment whether in the UK or more sunnier climbs.

To see the exhibitors above or to find out more about investing abroad or in the UK visit the Property Investor Show March 23rd-25th at the NEC. Entrance is free and visitors should register online at propertyinvestorshow.com/birmingham.