London continues to remain the most attractive property hotspot for Middle Eastern investors, although buyers are now seeking for greater value for money.
Paul Preston, director and head of property investment company IP Global Middle East said the UK capital is still considered a safe haven for property investors.
“Through the first six months of 2013 we have seen increased levels of investment (year on year) going into central London with transaction levels up almost 50 per cent,” he told Gulf Business.
However, Middle East investors are not all investing into the luxury apartments of Mayfair and Knightsbridge as they did in the past and are now looking at areas undergoing regeneration programmes.
“In April we launched a 55 unit property in EC1 which we sold out within 48 hours with 75 per cent of the transactions coming from Middle East investors,” said Preston.
“GCC investors are now starting to look for value and prefer investing into areas with prices at £1,200 per sq ft rather than the £4,000 per sq ft of Knightsbridge and Mayfair.”
London benefits from being a political safe haven and a global financial centre, and with the pound dropping in value – reaching below the 20 year average versus US dollar – investors are quickly stacking up properties in the city, agreed real estate consultant Jones Lang LaSalle.
Property agent Hamptons, which held an exclusive two-day exhibition of prime London property in Dubai in April this year, also said it is recording an increasing interest from regional real estate buyers.
Apart from London, Middle East investors are also investing capital in residential areas in cities such as Chicago and Kuala Lumpur, said Preston.
“Investors continue to look at markets that are priced well, markets which offer full legal ownership to foreign investors, in locations where there is a strong tenant demand. These are the key drivers currently for GCC investors,” he added.
In its latest report, IP Global stated that Jakarta, in Indonesia, is currently the brightest city for overseas real estate investment, followed by Australia’s Mackay and Kuala Lumpur in Malaysia.