After learning the fundamentals of real estate investment in London, let’s take a look at some of the most sought-after property types chosen by foreign buyers and investors. Most experts define four main categories of investment properties in the capital: apartment flats, student accommodations, detached houses, and development projects. The primary focus is typically on the first two. With entry points starting around £100,000, expected returns range between 4% and 10%. For most investors, the break-even period is between 5 to 10 years.
Purchasing student accommodation in London is one of the most popular types of investments preferred by foreign buyers. Interestingly, investors usually do not manage the student residence themselves, as they sign contracts with a local UK-based management company responsible for the property. These companies handle the financing, management, and transfer of rental income to the investor on a monthly or quarterly basis.
It is worth noting that the new-build market is often seen as more favorable than existing homes for several reasons. Newly built homes in London are in higher demand per square meter, are easier to market, and can be purchased off-plan (with installment options and before construction is completed).