Property consultant Knight Frank Thailand expects a surge of more than 40% in sales of British real estate to Thai buyers, tallying 1 billion baht, with investors and currency the main factors.
Frank Khan, executive director and head of residential, said there was a notable rise in the number of Thai investors buying UK property last year, accounting for 20% of the total transactions it closed.
"In previous years, nearly 100% of Thais who purchased properties in the UK through us did so for accommodation for their children while they studied. Starting last year, we had Thai investors who bought four apartment units specifically for rental purposes," he said.
In 2022, Knight Frank closed sales of 15 properties in the UK worth 700 million baht from Thais, up from five units worth 300 million in 2021.
"The strength of the baht against the pound is attracting Thai investors to the UK property market, with rental yields ranging from 2.5% to 2.8% per year and annual capital gains of 12% to 15%," said Mr Khan.
Last year the purchasing budget per unit increased to £2-6.5 million, up from £1.2-1.5 million in 2021. The four units bought for rent were priced between £2.5-3 million, he said.
Central London locations such as Kensington and Holland Park remained popular among parents seeking properties close to universities.
Meanwhile, investment buyers focused on areas with high capital gains and rental yields, mostly outside London, said Mr Khan. Locations such as Manchester, Liverpool, Birmingham, Cambridge, Leeds and Edinburgh were among the top choices for investment buyers because of comparatively lower property prices than central London, he said.
"A 500-square-metre duplex unit in central London would cost around £10 million, whereas the same-sized unit outside of London would only cost around £2.8 million," said Mr Khan.
According to the UK's Land Registry, London had annual price growth of 9.2% in July 2022 with a rise of 1.1% month-on-month. The average price of a London property was £543,547.
He said investing in British property now offers a good opportunity as the pound is expected to appreciate in value by 2025, thanks to the upcoming UK general election. The pound's weakness is attributed to the impact of the Russia-Ukraine war on rising utility prices.
"We anticipate this will be one of our busiest years, with customers scheduled to view UK properties every month from April through December. We are talking with a listed company that is seeking to invest in residential and office building blocks with a budget of £30 million," said Mr Khan.
