Last week I read an interesting article focusing on whether it was best to invest in UK property or overseas property. The article never really reached a conclusion, instead it simply pointed out the good and bad points of each and covered a few cases where people had invested to better or lesser success in both.
The thing is the article would never really have been able to reach a conclusion, because the question is nowhere near as simple as it at first sounds. This is mainly due to the fact that there is no such thing as a UK or overseas property market.
The UK is made up of many regions that all perform in a very different way. For instance, the market in London is very different to the market in Penzance, and in turn the market in Penzance is very different to the market in Bradford. But it goes further than this because there are of course different types of property as well as different locations and as such, 2 bedroom apartments perform differently to 2 bedroom houses, and so on.
The UK versus Overseas question is one which I have been asked many times. So let me tell you where I stand on this. I believe that both are good and bad. There are some fantastic opportunities right now in the UK with strong rental demand and surprisingly strong capital growth. There are also some shockingly bad opportunities. Likewise, around the world, there are some mouth-wateringly good opportunities but there are also some eye wateringly bad ones. The key here is research.
Never dismiss a region or entire country because it’s widely believed to be bad. Research a little deeper and see if there is a hidden gem just sitting out of eyesight. Maybe a town that has a chronic undersupply of a particular type of rental property, or a region with incredible tourist potential that is about to be unlocked by the opening of a new nearby airport, or an area where prices have clearly over fallen and the only way is up. This is where professional property investors really make their money, but it requires effort and time to research.
So you can see that the original question really has no answer, I believe a little bit of everything is good. As the saying goes `never put all your eggs into one basket’, by spreading your property portfolio across different regions and countries you are effectively reducing your exposure to risk.
