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Year: <span>2018</span>
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Construction Update – The Residence (Sept 2018)

Categories:Construction Updates

On behalf of the developer, we provide you with the latest images and information as of September 2018 from The Residence construction site in Manchester, UK. Kindly click on the image below to access and flip through the update.

FLASHBACK: The Residence

The Residence is only a few minutes’ walk from Manchester City Centre. It sits at the doorstep of Spinningfields (The Canary Wharf of the North), Manchester’s main shopping and commercial district and Deansgate, the financial district of the city. The Residence occupies a prominent position within the stunning new £400 million Greengate Masterplan Project and, upon completion, will be one of the tallest residential buildings in the city, making it highly desirable for tenants. The regeneration of Greengate is expected to unlock £400 million of investment over the next 15 years.

CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260 (MY); +65 3163 8343 (SG)

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Construction Update – Aura (Sept 2018)

Categories:Construction Updates

On behalf of the developer, we provide you with the latest updates as of September 2018 from the Aura construction site in Liverpool, UK. Kindly click on the image below to access and flip through the update.

FLASHBACK: Aura

Smart student living

Aura is a brand new, purpose-built student accommodation development strategically positioned in Liverpool’s thriving Knowledge Quarter, the city’s education hub. The fully-managed development comprises en-suite rooms and studio suites, delivered fully-furnished and finished to a high standard. In addition to having a gym, yoga lounge and games room, this self-contained development has on-site laundry facilities, and a restaurant. Bike storage is available in the courtyard for the students’ convenience.

Aura is just a few minutes’ walk from the University of Liverpool. The Royal University Hospital, Liverpool John Moores University, Liverpool Hope’s Creative Campus and LIPA are also in close proximity.

Investment Highlights

  • 9% nett rental return p.a. assured for 5 years
  • Catchment of 57,000 students from 5 sought-after universities, with a current shortfall of 21,900 managed bed spaces
  • Fully-managed & fully-furnished
  • Located in the Knowledge Quarter
  • Walking distance to the prestigious University of Liverpool
  • Close to Liverpool city centre and main transport hubs

Specifications

  • Free high-speed Wi-Fi
  • Communal lounge and shared kitchen facilities with smart LCD TVs
  • 24-hour CCTV security and controlled building access
  • Fully-equipped state-of-the-art gym and yoga lounge
  • Courtyard with bike storage
  • Large meeting area, lounge and study areas
  • Games room with pool tables, entertainment facilities and smart LCD TVs
  • Restaurant
  • On-site laundry facilities

CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260 (MY) 3163 8343 (SG)

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What Does the UK Budget Have in Store for Property Investors?

Categories:Reading and Research

The UK Autumn Budget proved that despite the government’s latest initiatives in addressing housing affordability for first home buyers, landlords remain pivotal to the supply of housing in the UK.

At a glance, the Autumn Budget (Oct 29) had good news for first-time house buyers in the reduction of stamp duty on jointly-owned property. The relief applies to homes of up to £500,000 and is in addition to the first-time buyer stamp duty exemption announced last year.

The Chancellor also declared that the government would allocate £500m for the Housing Infrastructure Fund to enable a further 650,000 homes to be built. This is on top of the previous pledge of 300,000 homes per year, on average, to raise housing supply by the mid-2020s.

Alongside the newly announced stamp duty relief for first home buyers, this is a laudable measure to alleviate housing unaffordability, yet there remains a lack in optimism where the issue of housing supply is concerned.

Landlords & Private Rental Sector: A Necessity to Solve UK Housing Woes

Historically, the UK has been plagued by a chronic shortage of housing. Not only had the government failed to meet its previous target of building 240,000 homes by 2016 (a target set in 2007), it had also changed Housing Ministers 16 times — more than 20 times faster than the average UK homeowner moves houses!

A research by Heriot-Watt University shows that the undersupply has become even more critical: England alone faces a backlog of 4 million houses.

UK house price and rental forecast 2018-2021 (CBRE)
UK house price and rental forecast 2018-2021 (CBRE)

More houses are needed to address homelessness as well as skyrocketing house prices and rents. And this is where the private rental sector comes in. Not only are landlords pivotal in ensuring the supply of rental housing for the growing number of young people unable to afford their own homes, they also provide flexibility for millennials who prefer to rent.

New research has shown that UK property remains a lucrative investment with 88% of landlords able to gain a profit, as the imbalance in supply and demand continue to drive rental prices.

Updated Incentives/Exemptions for Landlords

Investors and landlords can look forward to the following updates moving forward:

(a) PERSONAL ALLOWANCE

Landlords can claim an increased personal allowance amount of £12,500 off their taxes in 2019/20. The personal allowance is currently at £11,850.

(b) CGT ANNUAL EXEMPTION

The Capital Gains Tax (CGT) annual exemption will be increased from £11,700 in 2018/19 to £12,000 in 2019/20.

Potential SDLT surcharge

Some weeks ago, Prime Minister Theresa May announced the possibility of a Stamp Duty Land Tax (SDLT) surcharge of 1% – 3% to be imposed on overseas landlords/ property buyers from Jan 2019.

The government has now revealed that it will propose a surcharge amounting to only 1% during the Budget, and that a consultation on the surcharge will be published in January. Stay tuned as we continue to monitor the news and provide updates in due course.

Interested to invest in UK property and be a landlord? Invest before the foreigner SDLT surcharge kicks in in 2019! Call us and make that smart choice today at (+65) 3163 8343 (Singapore), 03-2162 2260 (Malaysia). Or, email us at info@csiprop.com!

Find out more about Arden Gate, our latest Birmingham residential investment property in the Midlands. Birmingham has been voted the UK's fastest-growing city by PwC. Come meet our developer rep and learn about Birmingham's bullish property market.

Find out more about Arden Gate, our latest Birmingham residential investment property in the Midlands. Birmingham has been voted one of the UK’s fastest-growing city by PwC. Come meet our developer rep and learn about Birmingham’s bullish property market.

By Lydia Devadas
Edits & additions by Vivienne Pal

Source:

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Construction Update – Colonial Chambers (Oct 2018)

Categories:Construction Updates

On behalf of the developer, we present to you the latest updates as of October 2018 from the construction site of Colonial Chambers in Liverpool, UK. Kindly click on the image below to access and flip through the update.

Click here to watch video: https://www.dropbox.com/s/5eg13fxrpn6ctqb/Colonial%20Chambers%20Walkthrough%20-%20October%202018.mp4?dl=0

CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260 (MY); +65 3163 8343 (SG)

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Millennials Loss in Home Ownership A Landlord’s Gain?

Categories:Reading and Research

Home ownership, especially among the young, in the UK has declined significantly compared to a decade ago. As the name suggests, Generation Rent is growing, now more than ever before.

Today, 40% of young adults are unable to afford one of the cheapest homes in their area even with a 10% deposit.

For 25- to 34-year-olds earning between £22,200 and £30,600 per year, home ownership fell to just 27% in 2016 from 65% two decades ago. This is an indication of home ownership collapse over the past 20 years especially among those from the middle-income range.

Back in 2016, data by the Office for National Statistics had highlighted that the number of homeowners in the 22- to 29-year-old age group stood at 37% in 2008 compared to just 27% over the last 10 years. This drop in homeownership among young adults has several contributing factors.

The drop in homeownership among young adults. Image credit: IFS
The drop in homeownership among young adults. Image credit: IFS

Disparity in House Price Growth vs Income Growth

Rising house prices relative to income growth has robbed the younger generation of the ability to buy their own home, while the increase in rental rates has made it almost impossible to save for a deposit.

House prices have risen around 7 times faster compared to wages over the last two decades. New research by the Institute for Fiscal Studies (IFS) reveals that since 1997, the average property price has risen by 173% in England after adjusting for inflation, and by 253% in London. Meanwhile, rental cost has risen from an average of £140 a week to £200 a week in England.

The expanding disproportion between income rate and ever-growing house prices is resulting in a severe unaffordability crisis among young adults.

Income versus house price growth Source: IFS, Image Credit: The Sun
Income versus house price growth Source: IFS, Image Credit: The Sun

According to a report by the Sun, back in 1995/96, 2 in 3 (65%) of 25- to 34-year-olds from the middle-income bracket were homeowners.

But by 2015/16, the number plummeted to just 27% where only 1 out 4 of this group owned their own home.

At the time,  average house prices were a staggering 152% higher than they were 20 years earlier after adjusting for inflation. Meanwhile,  the nett family income of those aged 25-34 increased by only 22% over the same period, causing a relentless imbalance between household incomes and house price growth.

A Preference for Experience-focused Living

Another notable factor is the youngsters’ preference for an experience-focused living.

Millennials prefer living amongst a like-minded community. For many, renting a house enables them to live close to the city centre — which also happens to be where they prefer working — and be part of a community that possesses similar lifestyle practices. This aspect seems to have taken the priority seat compared to being able to buy a house.

Purchasing a property near the city centre is close to impossible due to exorbitant prices, hence, renting becomes the next best option.

An Opportunity for Investment

This drop in home ownership and high demand for rental properties amongst the millennials signifies a huge shift for the UK’s rental and investment sector, offering opportunities for investment returns. In Manchester alone, one of the fastest-growing cities in UK, an estimated 11,000 new jobs are forecasted to increase by 2022, yet only 4,000 new properties in the city centre are expected to be built by then.

The lack of supply in residential properties alongside growing job opportunities increases the demand for rental properties which, reciprocally, opens the gateway for investment. In September 2018, the UK government and Barclays Bank announced a new £1 billion loan fund to drive construction levels in the country’s property sector, with a focus on providing greater numbers of purpose-built rental property in key markets.

The ever-growing rental market promising capital growth and rental income clearly opens an array of investment opportunities for investors looking to spend their money wisely.

By Lydia Devadas 
Edited by Vivienne Pal
  • https://www.ifs.org.uk/uploads/publications/bns/BN224.pdf
  • https://www.ons.gov.uk/peoplepopulationandcommunity/housing/articles/homeownershipdownandrentingupforfirsttimeinacentury/2015-06-19
  • https://www.bbc.com/news/business-45776289
  • https://www.theguardian.com/money/2018/apr/17/one-in-three-uk-millennials-will-never-own-a-home-report
  • csiprop.com/investors-can-look-forward-to-uk-rents-increase-of-15/
  • https://www.thesun.co.uk/money/5590859/one-in-four-middle-earners-own-home-ifs-report/
  • csiprop.com/manchester-top-10-in-the-world-for-fdi/
  • https://uk.reuters.com/article/uk-britain-housing-barclays/barclays-and-uk-government-launch-1-billion-pound-house-building-fund-idUKKCN1LR2P1
  • Image Source: https://www.huffingtonpost.co.uk/2014/05/01/shocking-uk-renting-facts_n_5246159.html

 

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UK Landlords Still Making a Profit, Survey Finds

Categories:Reading and Research

The UK rental sector is buoyant with demand for rental properties increasing and landlords making a profit. By region, the Northwest has shown the highest yields to date.

88% of landlords in the UK made a profit in the last three months (July – Sept), research by BM Solutions found.

The buy-to-let arm of Lloyds Banking Group did a survey of 700 landlords in the UK, finding further that landlords who reported a loss were a mere 4% of those surveyed, with the remaining 8% breaking even.

This is positive news for property investors, one that is buffered by the undersupply of housing in the UK.  

BM Solutions head Phil Rickards said, “Despite many recent challenges to the buy-to-let market, it’s encouraging that more landlords have made a profit from their buy-to-let properties this quarter, and that landlords are feeling slightly more upbeat when it comes to the near-term prospects for rental yields, the UK private rental sector and their own letting business compared to (the same quarter) last year.”

Average rental yields in Q3 2018 were still at a high of 5.9%, albeit not at the record levels seen last quarter at 6.2% – the highest since Q4 2014.

By region, yields in the Northwest were the highest at 6.7%, while the lowest yields were found in Scotland at 4.9%. Central London was at 5.3%.

Tenant demand had increased to the highest level recorded since Q2 2017. The proportion of landlords reporting a drop in tenant demand is now at its lowest point since the end of 2016, falling 8% from the last quarter.

Mr Rickards said, “For those speculating about the future of buy-to-let, the figures supporting tenant demand should help to dispel this myth. Considering the much talked about shortage of housing supply, it is vital that we continue to support a healthy private rental sector and with tenant demand scores improving, or remaining stable across all UK regions, it is clear that the private rental sector still has a very important part to play.”

A third of landlords surveyed raised rents over the past 12 months, representing a slight increase from Q2. There was also an increase in the proportion planning to increase rents in the next six months, reaching 27% from 24%. More landlords are also seeing rents rising in the areas where they let properties, with an increase of 9% from Q2.

Even in the capital, where house price growth has seen better days, demand for residential property continues to rise.

Residential letting specialists Benham & Reeves says that the last quarter has been the busiest in their history. Q3 2018 had a 22.1% increase in transaction volumes compared to 2017 Y-O-Y.

The agency said in a statement: “We now have 22 applicants per property, compared with 16 at the same time last year, a sure sign that the world’s capital, London, shows no sign of lessening in popularity in terms of where to live.

“It’s been a staggering three months when you consider how much the London property market has been in the news, in addition to fears around Brexit continuing to make the headlines. This has not impacted on the appetite for London rentals, however. From small units to large, from new-build apartments to period, basement properties, demand has been high across the board, and at every price point.”

Interested in being a UK landlord and benefitting from the intense demand for housing there? Come check out our latest investment in the Northwest and find out how you can get amazing yields. Give us a call at (+65) 3163 8343 (Singapore), 03-2162 2260 (Malaysia), or email us at info@csiprop.com!

By Ian Choong; Edits by Vivienne Pal

Sources:

  • http://www.propertyreporter.co.uk/landlords/record-number-of-landlords-make-profit-in-q3.html
  • https://www.mortgagestrategy.co.uk/record-proportion-of-landlords-make-profit-bm-solutions/
  • http://www.propertyreporter.co.uk/landlords/could-average-rents-in-the-north-west-be-about-to-soar.html
  • Featured image: expatriates.co.uk
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Perth Property Prices to Increase in Jan 2019

Categories:Reading and Research

These next two months will be the last for foreign investors to make substantial savings on Perth property purchases. Come Jan 2019, Western Australia will join the rest of the country in imposing a stamp duty surcharge on foreign property buyers in the state.

 

Earlier this year, the Western Australia (WA) government announced that foreign buyers of residential property in the state will have to pay a stamp duty surcharge of 7%. WA is the last state in the country to impose a stamp duty surcharge on foreign property buyers.

The tax will be in force from 1st Jan 2019, and brings WA into line with the rest of Australia in imposing a foreign purchaser duty surcharge. This surcharge is now imposed by the six Australian states and the ACT at varying rates and scope.

Current additional stamp duty rates for foreign buyers in the Australian states
Current additional stamp duty rates for foreign buyers in the Australian states.

Australian citizens, Permanent Residents and special category visa holders do not need to pay this tax.

Corporations and trusts are not exempted as long as foreign interests in the entity exceed 50%.

Residential developments with 10 or more lots are excluded from the tax.

Cost breakdown of a WA property valued at A$500,000
Cost breakdown of a WA property valued at A$500,000

Industry players like the Real Estate Institute of Western Australia (REIWA) have opposed the tax. Its outgoing President, Hayden Groves said the tax will cause an upward pressure on rental prices.

A turn for the better

Perth’s median house price for September was at $505,000, 1% lower compared to last year YOY. Comparatively, 3 years ago the median house price was declining at a more significant pace, recording a 4.2% decline between September 2015 and September 2014.

Although prices in Perth remain soft, the decline of house prices has slowed, which is good news and an indicator that prices are starting to bottom out. Improved affordability in the Perth housing market presents investors with an excellent opportunity to get in before the additional stamp duty kicks in on Jan 1st, 2019 and prices start to rise again.

Incoming REIWA president Damian Collins said that in this quarter leasing activity was up, median rents remained stable, stock levels had reduced, average leasing times were quicker and the vacancy rate had plummeted to its lowest level in more than four years.

Perth’s vacancy rate declined to 3.9% during the September 2018 quarter – the lowest level Perth has experienced since the March 2014 quarter.

Located on Murray Str, in the heart of Perth city, NV is within 1 minute reach of top designer brands (King's Str) and a vibrant F&B & lifestyle area (Shafto Ln). NV boasts top notch lifestyle amenities and a trophy property in this growing city. NV will be envy of all. INVEST NOW BEFORE STAMP DUTY INCREASE OF 7% ON 1 JAN 2019.
Located on Murray Str, in the heart of Perth city, NV is within 1 minute reach of top designer brands (King’s Str) and a vibrant F&B & lifestyle area (Shafto Ln). NV boasts top notch lifestyle amenities and is a trophy property in this growing city. NV will be envy of all. INVEST NOW BEFORE STAMP DUTY INCREASE OF 7% ON 1 JAN 2019.

Mr Collins said, “With all key market indicators improving during the September quarter, Perth’s vacancy rate has now fallen below the 10 year average.

“The rental sector is really leading the charge in the Perth property market recovery. The September 2018 quarter results are very encouraging and should provide landlords and investors with a lot of confidence.”

Interested in to get into the Perth property market before the 7% tax kicks in? One of the latest developments in the city’s prime CBD (central business district), NV Apartments, has a superb location with a whole host of luxurious amenities, from just A$313,000. Act quickly and give us a call at (+65) 3163 8343 (Singapore), 03-2162 2260 (Malaysia), or email us at info@csiprop.com.

By Ian Choong
Edited by Vivienne Pal

Sources:

  • https://reiwa.com.au/about-us/news/perth-rental-market-has-strong-september-quarter/
  • http://www.ironfish.com.au/blog/2018/06/06/foreign-investors-consider-western-australia/
  • https://reiwa.com.au/about-us/news/foreign-buyer-surcharge-sends-wrong-message-to-vital-skilled-migrants/
  • Featured image: Nomads Hostels

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Construction Update – Lightbox (Oct 2018)

Categories:Construction Updates

On behalf of the developer, we present to you the latest updates from the construction site of Lightbox in Sheffield, UK, as of October 2018. Kindly click on the image below to access and flip through the update.

Flashback: Lightbox

The Heart of Sheffield

Lightbox is a landmark living space set at the heart of Sheffield’s thriving creative Hub and the Cultural Industries Quarter, a short walk away from Sheffield Rail Station, the Crucible Theatre and Sheffield Hallam University.

Units come fully-furnished with premium fixtures and fittings, complete with the latest appliances. Amenities like the dedicated concierge, on-site gym, ground floor café/restaurant and residents-only cinema will certainly appeal to its discerning tenants.

Project Highlights

  • 1 – 2 bedroom, and studio units
  • Fully-furnished
  • Dedicated concierge, café/restaurant, on-site gym and residents-only cinema
  • Suitable for both students and young professionals
  • Car park spaces available

Investment Highlights

  • Prime location
  • Fully-managed
  • 8% p.a. nett returns
  • 3 years assurance
  • Up to 17.5% discount*
  • Completion in Q1 2019 July 2018
  • Price from £83,000

CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260 (MY); +65 3163 8343 (SG)

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Perth Set to be the Next Melbourne

Categories:Reading and Research

Perth is set to be the next Melbourne, a new report from Infrastructure Australia indicates. After a stagnant 2017, Corelogic predicts that house prices in the inner city will rise by 3.3% this year and 4.1% in 2019. With prices at an affordable rate, property situated in choice locations are ripe for the picking and investors stand a chance to reap returns from the growth of the property market in the future. 

Currently Perth is Australia’s fourth largest city by population. By 2046 it is forecast to leapfrog Brisbane into third place, with 4.3 million people — the current population of Melbourne. And if the Government’s recent proposal to restrict immigration to Sydney and Melbourne goes through, the city’s eventual population may exceed even that figure.

Australians traditionally are resistant to the idea of living in apartments, and this is more so for those living in Perth. Just 6.6% of the city’s residents live in apartments, half the national average of 13.1%. This will change as numbers increase — as a large-scale city grows, it expands not just outwards but upwards as well.

The Perth suburban sprawl stretches along the Western coastline for about 150km, making it almost nine times as large as Singapore, but with just over a third of its population. As the population grows to a similar scale as Melbourne, apartment living will become more widespread.

The 2016 Australian Census showed that there is one occupied apartment for every five (1:5) occupied separate houses in Australia; compared with one to every seven (1:7) 25 years ago. Apartments are also getting taller. Twenty years ago, about 20% of apartments were in blocks at least four storeys high, with the proportion now closer to 40%.

Over the past decade, the number of apartments in the Perth council area alone has increased by about 150%. Perth has seen changes in planning that recognises this, and state and local governments are encouraging strategic placing of mixed-developments where they benefit the most, close to existing good transport, infrastructure and in high-amenity locations.

One example of these developments is NV, a new off-plan apartment within Perth’s central business district (CBD), benefitting from the completion of the Perth City Link.

Perth City Link is a major urban renewal and redevelopment project to the tune of over A$5 billion, playing a central role in regenerating Perth’s entertainment, cultural, shopping and infrastructure links. Rail and bus links have been completed, connecting the city centre with the Northbridge entertainment precinct. Currently, further development is ongoing on a mix of retail, tourist, office and residential accommodation.

Corelogic looked at changes in the property market across Australia over the last 25 years, and found that prices in Perth grew at an annual 6.7% for houses and 6% for apartment units since 1993 — making it the third best property market after Sydney and Melbourne.

Located on Murray Str, in the heart of Perth city, NV is within 1 minute reach of top designer brands (King's Str) and a vibrant F&B & lifestyle area (Shafto Ln). NV boasts top notch lifestyle amenities and a trophy property in this growing city. NV will be envy of all. INVEST NOW BEFORE STAMP DUTY INCREASE OF 7% ON 1 JAN 2019.
Located on Murray Str, in the heart of Perth city, NV is within 1 minute reach of top designer brands (King’s Str) and a vibrant F&B & lifestyle area (Shafto Ln). NV boasts top notch lifestyle amenities and is a trophy property in this growing city. NV will be envy of all. INVEST NOW BEFORE STAMP DUTY INCREASE OF 7% ON 1 JAN 2019.

Following the nation’s property downturn, prices have slipped by more than 10% across the city since mid-2014, although some areas have managed to be relatively unscathed. The outlook for the next two years is that improvement in the economy and population growth will stabilise the Perth real estate market. After a stagnant 2017, Corelogic predicts that house prices in the inner city will rise by 3.3% this year and 4.1% in 2019.

RED ALERT: Perth will be imposing additional stamp duty for foreign investors in January, which is an extra 7% on the property price. Investors looking to buy property can avoid the hike by signing contracts before Jan 1st, 2019.

Interested in to get into the Perth property market before the 7% tax kicks in? One of the latest developments in the city’s prime CBD, NV Apartments, has a superb location with a whole host of luxurious amenities, from just A$313,000. Act quickly and give us a call at (+65) 3163 8343 (Singapore), 03-2162 2260 (Malaysia), or email us at info@csiprop.com.

By Ian Choong
Edited by Vivienne Pal 
Sources:
  • https://thewest.com.au/lifestyle/real-estate/perth-destined-to-become-the-next-melbourne-ng-b88972063z
  • https://thewest.com.au/business/housing-market/perth-property-market-suffers-worst-fall-as-inner-city-and-south-west-suburbs-tipped-for-revival-ng-b88962488z
  • http://www.abc.net.au/news/2018-01-16/perth-apartment-development-debate-suburban-sprawl/9324992
  • https://www.perthnow.com.au/news/wa/new-figures-show-more-perth-residents-living-in-apartments-ng-8f60dd3e490dbac3aa5329aa42e51184
  • https://cdn.mra.wa.gov.au/production/documents-media/documents/central-perth/perth-city-link/file/perth-city-link-fact-sheet.pdf
  • https://www.mediastatements.wa.gov.au/Pages/McGowan/2018/08/$158-million-development-approved-for-Perth-City-Link.aspx
  • https://www.finance.wa.gov.au/cms/uploadedFiles/_State_Revenue/Duties/Duties_Circular_17-Foreign_Buyer_Duty.pdf
  • Featured image: State Library & TripAdvisor

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Avoiding UK’s New Foreigner Stamp Duty Surcharge

Categories:Reading and Research

Stamp duty for foreign buyers could be increased by up to 3%, UK Prime Minister Theresa May announced last weekend at the Conservative party’s conference in Birmingham.

The new increase in stamp duty, to be paid by individuals and companies not paying tax in the UK, will be rolled out after a consultation.

The new levy, once effective, is in addition to the stamp duty surcharge introduced in April 2016 on second homes.

UK STAMP DUTY FOR INDIVIDUALS OWNING MULTIPLE HOUSES

Stamp Duty for Individuals Owning Multiple Houses
The latest levy, once implemented, is next on a list of measures taken by the government on the property market which includes the latest introduced in 2016.

Amid criticism that the Government’s efforts to tackle the housing crisis has been a flop, Mrs May’s latest measure intends to bring down property prices for British residents by deterring foreign buyers.

Mrs May said on the BBC that her party is “very concerned about the impact that foreign buyers have on the housing market and the impact they have on people who are living here and trying to get into the housing market. The evidence is that foreign buyers coming in pushes house prices up and lowers home ownership here.”

Best Time to Invest

However, the move could be counterproductive, as reduced foreign investment could set back house-building efforts. Builders sell off-plan property in order to seek better financing terms, and the lack of foreign cash injections could slow down projects in the pipeline.

Virata Thaivasigamony, CSIPROP’s Director of Research  feels that this would be a stopgap measure with potentially no real long term solution for housing supply in the UK.

“Price growth is influenced by supply and demand. There is already a glaring shortage of housing in the UK, which is a driving factor in house price inflation. Existing homeowners are facing challenges in downsizing or upgrading their homes, while millenials are unable to afford their own homes, hence the need for buy-to-let property.

“This new measure could be good in the short term for local buyers. However, foreign property investors have helped increase the supply of housing in the UK, and deterring foreign investment will have a knock-on effect on housing supply,” he said.

Trevor Abrahmsohn of estate agents Glentree International says, “whilst it is a laudable aim to raise a few hundred million pounds for homeless people, at this critical time for the country, when you want to encourage inward investment why stick up a notice to foreign investors saying ‘we’re closed for your business’?”

Adam Challis, head of residential research at property agents JLL, said: “It’s another small change but if it is read by investors as a signal of something broader, it’s quite possible that it will have a material effect on supply.”

Recent research has indicated that England has a severe backlog of 4 million homes. The Government will need to build 340,000 homes per year until 2031 in order to address the backlog. Current building efforts have fallen short — in 2016/17 only 217,350 homes were built and the government’s current pledge to build 300,000 homes annually by the mid-2020s, will not fully address the shortfall. 

Thus, any slowdown in housebuilding could further push property prices, having the opposite effect of what Mrs May intends.

“If you’ve been sitting on the fence about investing in UK property, now is your best chance before the surcharge gets implemented. We are talking substantial savings,” Virata advised, adding that he foresees increased investment activity in the near future as foreign buyers attempt to beat the surcharge increase.

The increased duty will raise £40m to £170m a year, against the existing £9.5bn for residential property. Mrs May said this would be spent helping rough sleepers, whose numbers have been rising.

In August the government launched a £100m drive to eradicate rough sleeping in England by 2027.

If you’ve been sitting on the fence about investing in UK property, don’t hesitate any longer. Learn more about the savings that you get from buying before the stamp duty surcharge: give us a call at (+65) 3163 8343 (Singapore), 03-2162 2260 (Malaysia), or email us at info@csiprop.com!

By Ian Choong
Edits & additions by Vivienne Pal

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