How Foreign Property Buyers are Affecting Removals
The rise of foreign property buyers and expats in the UK is having a big impact on the removals industry. Serviced accommodation is rising in popularity, leaving many removals companies without the income opportunities of a large-scale international removal, but surely a more fluid property market has its benefits?
Serviced accommodation, leased property already fully furnished, is on the rise. In 2013 it became recognized as an official sector of the property market, and a 2013 report by property firm Savills even predicts that the industry could more than triple by 2018. Most commonly as either one bedroom or two bedroom properties, serviced accommodation provides all of the home comforts without the moving and decorating hassle. Many even have reception and concierge services.
These types of accommodation are mainly focused on the international business traveller, offering leases for either short or long term, so it’s no surprise it’s become popular. But, what does this mean for the removals industry? Well, it’s not good news. With no need to transport furniture and general household items, the jobs available from overseas property buyers and renters have become vastly smaller. In many cases, if the foreign buyer is only bringing the bare essentials in a suitcase, a removals company isn’t even needed.
But, although the use of serviced accommodation is increasing, not every foreign buyer is making use of it. With the increase of freight costs on major shipping lines that came into effect on 1st March 2014, the removals jobs that do go ahead have mostly increased in price. Removals companies have two choices here; keep overall prices low and absorb the increase as a deficit in profit or increase the cost of the removal. The benefits and drawbacks are completely dependent on the individual company.
On the most part, however, the removals industry is facing an increase in business from these new foreign buyers. More and more are purchasing property, not just at high prices in London, but at lower prices elsewhere in the country. UK estate agents are making a killing abroad, placing adverts that target specific countries such as China. A recent Hong Kong advert for Hardy Mansions stated that the complex was “in the heart of Notting Hill”, close to Notting Hill tube station and had “luxury brands of shops” nearby as a part of “prime central London”. In reality, the apartment is in Zone 2, at least 20 minutes walk from the tube station and with more council estates nearby than shops, but from overseas this can be hard to discover. At £560,000 for a one bed flat, the estate agents are raking it in even if the removals industry isn’t.