South Africans focus on UK when investing abroad

South Africans are queuing to buy property abroad - and most want to invest in the UK says one top international property group who is handling up to 15 calls a week from SA would-be overseas investors.

Barak Geffen, Executive Director of Sotheby's International Realty South Africa says innovative fractional ownership schemes are fuelling the trend.

The majority of the local calls we get are from buyers looking to purchase around the 250 000 to 2 million mark.  These are second home investments that purchasers will generally rent out through an already set up rental scheme. 

"South Africans who relocate spend anything up to $5 million and this may become their primary or second residence depending on whether they are  moving lock stock and barrel from SA or not.

Geffen says fractional ownership schemes - which is a relatively new model of property investment - is allowing purchasers ' to buy hotel suites. A Sotheby's International Realty London client, Guest Invest, offers hotel suites in excellent parts of the city from 341 000. This entitles the purchaser to 52 nights ' accommodation a year and through the hotel management programme, a guaranteed rental income of 6% in the first year.

The concept provides frequent travellers with an easy accommodation option in the centre of London that doubles as a lucrative investment.

London is  one of the financial capital s of the world and will always provide excellent  business opportunities. It has a stable economy and with an influx of Europeans into the UK in the wake of the European Union, demand for property is increasing. Prices are unlikely to drop in the near future. "

According to Geffen, UK bond repayments are quite manageable. He says on average a 2 bedroom apartment in an outer lying but good suburb of London will cost around 300 000.

Its the deposit that requires a major cash injection and a deposit of 25% or more attracts a better interest rate. It is however also possible to get a 100% bond with certain UK banks.

Although the average age of investors varies, according to our UK branches, the majority of South Africans looking to invest are in the late 20 to early 30 age group seeking sectional title properties on the outskirts of London, near universities and easily accessible transport routes.

The majority purchase as a way of diversifying and securing a global investment portfolio, he says.