Property: How to sell your home to a foreign buyer: If you are selling a country house, look to the Americans, says David Lawson

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The Independent Online
ONE influential group of housebuyers is keeping a small light shining in the darkness engulfing the property market. Foreign house hunters now see the UK as a bargain basement and are trawling the country for property.

'They took a lot more heart over the election result than UK buyers,' says Jamie Bell of Knight Frank & Rutley. International businessmen, who could choose to live anywhere in the world, feel Britain is still on course to become the financial centre of Europe - and they want a foothold here. It was almost inevitable that an overseas buyer picked up Vogan's Mill, the Docklands penthouse featured on these pages a couple of weeks ago. Despite plunging from pounds 1.7m to pounds 350,000, no British buyers could be tempted.

International buyers have always had their pick of Britain's most expensive property. Over the past four years they have bought one in three of all homes sold for more than pounds 1.25m. As UK buyers retreat further into their shells, these deals are becoming even more important.

Foreign buyers now account for about 70 per cent of prime property sales in central London, while country homes ravaged by the Lloyd's scandal and recession are being snapped up at reduced prices. Buyers include Canadians and Americans hungry for a taste of Olde England in grand rural mansions, as well as Italians and Hong Kong families, who see Britain as a safe haven.

So how can British owners tap this thin, but rich, vein of potential buyers? First, you have to live in the right place and own the right sort of home. A footloose international entrepreneur will look for something entirely different from a German banker, while Hong Kong expatriates may turn up their noses at homes that send Italians into a frenzy.

The Dutch are crazy about Scottish sporting estates - one has just bought 18,000 acres from Andrew Rettie of Strutt & Parker. Mr Rettie says foreign buyers make up as much as a fifth of sales between pounds 500,000 and pounds 7m. 'Many British owners are selling because of calls from Lloyd's, death duties or simply to make more from their capital,' he says. These estates hardly ever make a profit from leasing out the fishing and shooting.

North Americans are more likely to go for retreats in Wiltshire, Hampshire or the Cotswolds. They like to play the country squire but still be within easy motorway travel of Heathrow and London. Shawford Park, near Winchester, for instance, with its 50 acres of grounds, formal gardens and fishing, was a classic among the dozen or so residences worth more than pounds 1m that Knight Frank & Rutley has sold in the past six months. After a long and exhausting sales campaign, a retired Canadian took Shawford Park within four days of seeing the place.

Middle Eastern buyers, on the other hand, look for big houses with well-protected grounds for their large entourages, and stick to Berkshire, Surrey and bits of Hertfordshire. 'They spend a lot of time abroad and like to get home quickly after flying into Heathrow,' says Mr Bell.

University towns can cash in on foreign students arriving for studies or parents buying for their children. Out of 15 flats reserved in Oxford's central Gloucester Green development this year, 10 have gone to Far Eastern purchasers for between pounds 70,000 and pounds 150,000. By comparison, almost no interest has been shown in surrounding country houses.

This reflects one of the many national idiosyncrasies sellers should learn about. Hong Kong Chinese like to be close to their work, perhaps reflecting cramped conditions at home. 'They also prefer boxy, purpose-built property they can move straight into and which is easy to maintain,' says Richard Evans of Gascoigne Pees in Chelsea. 'They would never consider the typical Victorian pile that entrances Americans.'

Some developers must be thanking the heavens for this habit. Half the buyers at Taylor Woodrow's luxurious Kensington Green in central London are from the Far East. Elton and Kay Wan helped Barratt Southern make pounds 6m in sales to overseas buyers this year by taking an apartment in the distinctive Regency-style circle called Chiswick Place in west London.

'I studied textiles in Ealing several years ago, and now that our three-year-old son, Matthew, is nearing school age I want him educated in Britain, too,' says Mrs Wan. Other buyers who have paid upwards of pounds 300,000 include four more from Hong Kong, one from Japan, four Malaysians, one Thai, one Korean and an Iranian.

They are all looking for established areas near airports, good transport and schools - generally teaching in their own language. And they tend to go for classic styling rather than anything trendy, says David Pretty, chairman of Barratt Southern.

Central London is the biggest magnet: Middle Eastern buyers go for Knightsbridge and Belgravia because it is near both Harrods and the swish hotels. But if they want a 'cheaper' family-sized flat for about pounds 500,000, it is more likely to be in Kensington.

The Japanese are ruled by a rigid code that sets housing allowances according to their status within a company. The top people rate West End flats, while middle managers go to Wimbledon and Purley, near the Japanese school. 'They are not interested in frills or frippery,' says Lorna Vestey at Knight Frank & Rutley.

Americans, on the other hand, long for Victorian or Georgian piles with all the historical embellishments. 'Crumbling stucco can be a strong magnet,' according to Ian Homersham of John D Wood. 'Perhaps that's a good thing, as Americans take great pride in doing houses up. Some of the best renovations are by Americans.'

Paradoxically, they also demand civilised necessities such as huge modern kitchens and power showers. One developer has even put air-conditioning into a plush house in St John's Wood, where whole streets are colonised by Arabs and Americans.

Italians are the latest wave of colonists, however. They are pulling money away from a shaky home economy and share the British obsession for investing in property, even if they are only going to use it for a couple of months a year.

'They like classic, older homes which fit their image of the UK,' says John Vaughan, an agent who has made Italians his speciality. Apartments must be above the ground floor - hardly anyone would contemplate a garden flat - with all the original fittings. On the other hand, one Italian has just paid more than pounds 1m for a new house in Kensington Green.

Desperate sellers who cannot net one of these buyers might consider the alternative of renting instead. Last month 75 per cent of the lettings by Hamptons, based in central London, were to foreign buyers, who paid an average of pounds 464 a week. Demand is even spilling outside gold-plated locations, with overseas tenants making up almost 20 per cent of inquiries in outer London. A survey earlier in the year showed they took up almost 40 per cent of homes let in a broad swathe across the south.

'The UK is increasingly being regarded as a haven of political and financial stability, highlighted by unrest in Germany and tumbling share values in Japan,' said Hamptons.

If only UK buyers felt the same.

(Photograph omitted)

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