Real Estate Investor Magazine South Africa February/March 2019 | Page 56

WEALTH
Liverpool:
Worth Supporting on
and off the Field
Buy-to-let property in Liverpool and surrounding
cities is a winning investment strategy
BY MELISSA VAN ACHTERBERG
T
he Reds aren’t the only players at the top of the log.
That’s the opinion of Tim Mertens, Chairman of
Sovereign Trust (SA) Limited. Naturally, he’s talking
about off-shore investment opportunities for South Africans –
buying property in the UK’s greater north, to be precise.
  With Brexit D-day less than three months away, many
are questioning the soundness of the UK as an investment
destination.  But, British property market analysts say that
the fundamentals of ensuring a return out of property
investments won’t change: put down the biggest deposit you
can and aim to retain the property for at least five, preferably
10, years. Further, they’ve examined the underlying market
fundamentals and identified a trend for inner city urban living
populated by growing, youthful communities that provide an
ongoing supply of tenants.
Boom! You’re looking at Liverpool, Birmingham,
Manchester, Newcastle and, of course, London. These key
cities offer Brexit-proof potential, says Mertens. His advice,
in a nutshell? “As an investment destination, the UK is reliable
and profitable, and so Britain’s property market continually
draws international investors and delivers returns in GBP:
a currency long-established as a Rand hedge.  The ‘secret
sauce’ for buy-to-let investors is focusing on  areas where
populations of younger people are expanding rapidly, and
where employment prospects are sound.”
The metro cities in the greater north-region fulfil these
criteria. Liverpool’s population is set to increase by 12%
between now and 2041, with 42% of its residents being under
30 compared with the UK average of 37%. The city’s booming
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FEBRUARY/MARCH 2019 SA Real Estate Investor Magazine
service and healthcare sectors, knowledge economy and rich
cultural scene attract talented young professionals, and the
city’s entrepreneurial movement has accelerated a major
regeneration.
By 2041, Birmingham’s population is set to rise by 14.5%
reaching 1,313,300. Already boasting a 65,000-strong student
talent pool across five university campuses, the city has
the sixth highest graduate retention rate of any city in the
UK. Reading between the lines, it benefits from a vast pipeline
of future workers and entrepreneurial talent that feeds the
rental property market. Mertens says that, as Birmingham’s
city centre continues to expand, the demand for quality
new-build homes and developments will continue to attract
attention and the demand for housing in prime locations will
continue to rise.
Similarly, Manchester is in line to see its population grow
by 14.1% by 2041, with property prices up by more than 30 %
since 2013. As part of the Manchester-Liverpool metropolitan
region, it ranked in IBM’s list of top 10 global destinations for
foreign direct investment in 2017. The city is second only to
London in terms of its graduate returners, running at 58%, as
well as its influx of graduates with no prior connection to the
city. That’s population growth in real terms.
The over-achiever in the area, Newcastle, saw its city
centre populace swell by 112% between 2002 and 2015, and
projections give it 318,100 residents by 2041 from 297,400 in
2018. Student numbers at Newcastle University have shot up
by over 70% since 2000, while Northumbria University has
seen student numbers expand by over 114% over the same