Agents and developers are creating full-size show home-style properties overseas in a bid to woo wealthy foreigners who cannot travel to the UK because of Coronavirus restrictions.
In a podcast hosted by The National News – a United Arab Emirates newspaper – Henry Faun, partner and head of Knight Frank’s Middle East private office, explored how well-heeled international buyers were using technology to continue with their purchasing plans despite the pandemic.
Faun spoke of examples of properties in London being sold solely through virtual tours, without the overseas buyer being in attendance, and sometimes foreigners using London-based family or friends or buying agents to view properties on their behalf.
The podcast host – Alice Haine, business correspondent for the newspaper in London – then gave an example of a new London scheme for which a full-scale ‘model’ apartment was created in Dubai to allow UAE investors an opportunity to view, without having to visit the UK.
Faun says: “Those creative ideas are fantastic and helps to bring the market to the source of the buyers where you want to access them. Things like setting up a model home certainly does help with that.
“It gives the buyer the opportunity to feel the quality of the apartment. They can go and look at that nice marble or granite work surface, they can touch and feel the quality of the wood.”
But he says there are limitations – many buyers from overseas, he says, want to know what the nearby area is like, what restaurants they can walk to, and whether a location is noisy at night time.
Haine also spoke of the recently-increased taxation in the UK, where multiple measures over the past 10 years have led to much higher stamp duty and other taxes.
Faun accepted that tax was now relatively high for overseas buyers but he insisted this was not a disincentive.
“What I would say is that if a client was looking at a property four or five years ago when tax was less on properties, they may now think of this as a 10 or 12 year deal to ‘average out’ those taxes over a longer period of time” he says in the podcast.
You can hear the full broadcast, called Pocketful of Dirhams, here.