UK apartments lure Thai buyers with deals

Apartments in Britain are offering guaranteed yields and buyback programmes to entice Thai buyers amid the baht’s appreciation, according to investment and business consultancy PNN Capital Co.

Dao Wairaksat, the company’s business adviser, said there are many apartments in the United Kingdom, including off-plan and ready-to-move-in units, offering a guaranteed yield of 6.5-10% a year.

“The UK property market is mature, but competition is high with new small developers entering the market each year,” Ms Dao said. “Developers need to attract buyers with campaigns like discounts, high guaranteed yields and even buyback programmes.”

Five years ago, there were many residential projects offering buyback programmes, mostly for student accommodation in education-focused cities with units priced at £30,000-40,000 (or 1.18-1.57 million baht in current terms).

Today, a buyback programme is being offered at a renovated hotel, No.7 by La Tour, located in a seaside area of Blackpool, a resort town in northwestern England.

The property offers to buy back units in the fifth year at 110% of the selling price.

PNN by the end of June will introduce five residential projects to Thai buyers with units worth a combined 1 billion baht and aims to have at least 60 units sold worth 300-400 million baht by year-end.

“Five years ago, the most active buyers in UK properties were Chinese, but once the Chinese government put a control on capital outflow of no more than £50,000 two years ago, the Chinese slowed down their purchases,” Ms Dao said.

Developers in Britain have also sought to market outside of the country, with international roadshows and regional representative offices set up in key overseas markets, including Singapore, Malaysia and Hong Kong, apart from mainstays Dubai and Shanghai.

“They set up in Malaysia to tap buyers in Southeast Asia,” Ms Dao said. “It will be a centre where developers and potential buyers can easily fly to meet.”

Last year, PNN recorded 10 units sold worth a combined 100 million baht from a total of 40 units worth 1 billion baht at Elizabeth Tower, a luxury condominium in Manchester. Six were sold to Thai investors.

The company will also introduce condo units priced at £100,000-200,000 with a guaranteed yield of 7% a year in Phuket, tapping British buyers who want to spend holidays in a beach destination.