Ashley Osborne, Head of UK Residential at Colliers International, has more than 20 years of experience working helping Asian property investors buy property in London.
Currently based in London, Ashley also spent years in Hong Kong, giving him a unique perspective of the ‘supply chain’ that covers both the ends of the market.
In this article, he explains how Colliers International helps both private and institutional investors in the UK, and why you may want to look outside of London.
Ashley, please tell us a bit about yourself and what you do at Colliers International
I head up the residential business in the United Kingdom and within this division, there are four principal areas of operation including: Residential Development (i.e. the sale and acquisition of residential development sites across the UK), PRS – Private Rented Sector (acquiring and selling build-to-rent residential assets to the institutional markets); New Homes (the sale of new-build houses and apartments within the UK) and selling UK residential properties throughout our Colliers International offices and affiliated partners globally.
Prior to my current role, I was based in Hong Kong working for Colliers International as Managing Director of our International Properties business.
Alongside a highly committed management and sales team, we established one of Asia’s largest international sales platforms.
You have extensive experience with Asian property investors. How do you reach out to prospective buyers in the region?
Like all markets, there are many different types of property investors with varying requirements and stipulations.
Regardless of geographical and investor nuances, on the whole, buyers look for two key things: a high quality product which represents good value for money and secondly, excellent customer service.
As a business, our sourcing and due diligence teams have concentrated their search on finding high quality developments built by ‘best-in-class’ developers and there is no doubt that having a great product constructed by reputable companies with a proven track record is key to attracting buyers.
In many ways, this is half the battle and we have been lucky enough to work with some of the best UK developers.
Customer experience has always been an important part of our business. We have sales offices across nine different countries (Hong Kong; Singapore; China; Indonesia; Thailand; India; Philippines; Malaysia and Brunei) so whether a client is a first-time buyer or an experienced investor, we have always worked hard to ensure that there is a local expert who has the ability to help buyers from different markets with their property search.
All consultants have in-depth knowledge and training as well as a deep understanding of the UK market. By focusing on customer service, we have found that many of our buyers come via referrals from previous customers.
Asia is diverse, both in terms of culture and the level of economic development. What differences have you noticed between, say, Singaporean and Mainland Chinese investors?
We have a variety of buyers from all parts of the world so it is difficult to specifically categorise customers across different markets.
However, the trend we tend to notice most is that clients who have been investing in the international markets for longer such as Hong Kong, Singapore and Malaysia are generally more willing to purchase at higher price points and are looking for increases in capital value over and above running yield.
Buyers from emerging markets such as China, India and Thailand are typically looking to purchase properties at lower capital values where yields are likely higher, but the potential for short to medium term capital appreciation is not as high.
I can imagine that you deal a lot with Mainland Chinese customers these days. From which other places in Asia do your customers come from?
We have a broad sales network across Asia and have direct sales offices and/or affiliate partners in all markets across this continent, with the exception of Cambodia, Laos and Japan.
Do most Asian buyers invest in London property for the sole purpose of storing wealth, or is common to see non-residents act as landlords and rent out the property?
In all but a few scenarios, our clients are purchasing properties either for investment and are renting them out to local tenants or are using the homes themselves, usually for their children studying in the UK.
The vast majority of our buyers are leveraging the value of their capital by using a mortgage and therefore want income from a renter to contribute to their mortgage and operating expenses.
As a non-resident foreign landlord, do I need to pay taxes in the UK in the rental income?
Like most countries, non-resident landlords are subject to local taxes, however, these can vary significantly depending on both the cost of the investment and ownership.
We always encourage landlords to speak with independent tax advisers to provide recommendations on their specific set of circumstances.
Is London still the prime destination in the UK, or are they also looking for property outside of the capital?
As a truly global city, London’s only genuine peers are New York, Paris and Hong Kong and therefore, in our view, the capital is likely to always be the UK’s most popular investment destination.
Due to the current climate and currency benefits, London has recently experienced a resurgence of interest from smart money which also promotes further opportunities.
Additionally, as we witness the UK government focus on initiatives such as the Northern Powerhouse and Midlands Engine, a significant amount of infrastructure spending such as the new HS2 high speed line is also attracting foreign and domestic investors who see significant potential growth in markets such as Manchester, Birmingham, Leeds and Liverpool.