An appreciating pound looks set to cap 2017 on a high, but savvy Gulf investors can still look for real estate opportunities to negotiate better financing options, says international mortgage brokerage Enness.
“With interest rates still comparably lower than years gone by it makes sense to refinance onto a lower rate, and free up liquidity for other investments,” says Toby Johncox, Principal Representative at Enness.
The pound has appreciated approximately 12% over the UAE Dirham this year but is well off the higher rates it used to trade before the UK voted to leave the European Union in June 2016.
Eness is working with a number of clients to raise cash and invest in higher-yielding markets such as property in other UK cities or Europe, commercial developments, and other more lucrative investment opportunities, says Johncox.
The independent brokerage opened its fourth global office in Dubai last year.
Opening new offices in a region with a sizeable proportion of HNWs makes sense for the independent brokerage that has access to 250 banks worldwide.
“We’ve seen a 31% increase in GCC-based clients looking for financing solutions in the UK and Europe,” he says.
However, the London property market still holds value, according to Johncox. “Despite there being much doom and gloom reported in the London property market, high net worth (HNW) investors are still savvy in seeking opportunities,” he says.
Property prices have stagnated, but coupled with a weaker sterling, buyers can look to flexibility in terms of asking prices, according to Johncox. “We’re currently working with a client who is making a £500,000 saving on a property they planned to buy last year. Having waited, the property is now being sold for £2.3million, rather than the £2.8million price tag it originally held,” he says.
Banks also have the appetite to dry lend, says Johncox, where customers need not place any assets under the bank’s management or liquidity to secure a load. “It’s a further example of opportunity in the London property market,” he says.
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