There are no restrictions on ownership of foreigners, including the Arabs, for real estate in the UK. This is to support the diversity and inclusion of real estate investment there. Moreover, purchases are becoming easier for foreigners, including British Arabs, when they buy in cash.
At the same time, real estate investment by British Arabs requires identifying the real estate market, a market with a special character and unique feature.
It is important to recognize the volume of the capital before making the investment decision in the UK, meaning you should know the costs you may need for this investment and that prices in the UK are higher than in other European regions; houses in Britain are about twice the cost as the most expensive European region (France).
However, investment costs go beyond the mere purchase price, including in-advance costs and on-going costs. For example:
These are costs paid for the acquisition of property ownership, including:
Legal costs: The counsel plays a vital role in making your investment compatible with the law in Britain. Obviously, the counsel requires remuneration for his services, meaning there are legal costs on property investment in Britain.
Governmental expenses: Which include expenses (land registry fees) paid to the British government for the transfer of property ownership from the old landlord to the new owner (investor). They also include tax fees upon purchasing the property.
These costs are recurrent. They include:
Maintenance & repair costs: The maintenance costs are different according to the property. If the property invested is modern and undamaged, its maintenance cost will be low. If it is old with many damages, the maintenance cost is usually high.
Periodic expenses: These relate to the property itself, for example, taxes and water, electricity and gas bills.
Property investment achieves long-term revenues with relatively low risk. The real estate market in the UK is expected to grow following the decline of the coronavirus pandemic. This may form an investment opportunity for foreign investors, including British Arabs and especially Arabs from the Gulf region and the UAE, for their capability to finance their investments.
Property investment is not limited to merely investing in times of growth, as positive expectations have emerged concerning the growth of the real estate sector while many other sectors have witnessed an economic decline.
Despite some concerns considering Brexit, it is an opportunity for British Arabs to invest in real estate, especially those who have an income outside Britain.
With the decline of the UK’s currency rate due to Brexit, there was an investment opportunity for Arabs to buy properties in the UK in a non-British currency at a lower price. This is expected to achieve substantial profits with an increase in the value of the British currency.
Among the advantages of property investment in Britain is liquidity, as the selling or buying of real estate is expected to take a few months. In addition, demand exceeds supply. Hence, with an increase in population in Britain, there will be a bigger number of property tenants than owners.
The increase in demand over supply is an increase in real estate prices. Property prices in Britain are expected to increase 21.5% by 2025, with a disparity in the rate of growth from one region to another. On the other hand, property rent is expected to increase 8.5% by 2025, with a disparity in rental growth rate from one region to another.
Therefore, property investment is expected to be a worthwhile investment in general for investors from different nationalities, including British Arabs.
Since investors from different nationalities can invest in property with good yields, the real estate sector supports diversity and inclusion in the UK and Britain’s flow of foreign investment. One of the most important foreign investments in the British real estate market comes from Arab investors.