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Cape Town - Given the ongoing uncertainty of the rand, there has been an increasing interest shown by investors in international markets, especially London, according to Elias Tzouvanni, co-director of Nexus Property Group (NPG).
He says that, while many South African investors would like to capitalise on the more developed property market in London, there is often a lack of understanding around the practicalities of purchasing property overseas.
The London property market is highly competitive and in his opinion options for South African investors to raise finance or conduct lengthy due diligence are not as readily available as they are in South Africa.
As the exchange of contracts and deal completion are often very close together, funds have to be available and ready in advance, so that when the opportunity does arise, the property can be secured immediately.
“One of the most common queries we receive from South African investors in the process of selling local property is around what they should do with the money they are going to receive from the sale. London is such a popular investment destination for South Africans. In addition to earning stable returns and serving as protection from the rand’s future volatility, South Africa and England share a long-standing history," says Tzouvanni.
"The United Kingdom also boasts a highly developed property market, offering investors a vast range of opportunities in every economic climate. Adding to this attractiveness is the fact that the Bank of England recently cut interest rates from 0.5% to 0.25% - an all-time low.”
He explains that, essentially, South African buyers will be competing with experienced property investors from places like Eastern Europe and the Middle East, adding extreme pressure on deal facilitation and turnaround time.
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