Investing in the UK from Africa & overseas

In this guide we will talk you through everything you need to know about investing in UK property if you are from Nigeria, Ghana & other African countries

Investing in the UK from Africa & overseas

In this guide we will talk you through everything you need to know about investing in UK property if you are from Nigeria, Ghana & other African countries

Why Invest in UK Property from Nigeria, Ghana & other African countries?

The Nigerian property market has had a tough couple of years. After an excellent 2019, the pandemic caused a massive decrease in demand after job losses and salary cuts prevented many from renting better apartments or purchasing new homes. As a result, the market’s boom came to a halt. Whilst things are starting to stabilise once again, the interruption in momentum has seen ROI decrease significantly and left many Nigerian investors turning towards UK property.

Investing in UK property is widely considered to be one of the lowest-risk investments in the world. The market has performed extremely well year after year, even reaching unprecedented heights in the last couple of years after the coronavirus pandemic. Spurred on by a severe lack of stock paired with an unwavering demand for rental properties across the country, UK buy-to-let has experienced exponential growth in recent years, which is set to continue.

According to Savills, property prices in the UK are set to see an increase of 17.9% in the next four years, whilst rental growth is also set to hit an extremely impressive 18.1%. This forecast, paired with ever-increasing tenant demand across the country, makes UK property one of the best investment opportunities around.

Investing in UK property from Nigeria is an excellent way to diversify your investment portfolio with one of the most consistent and lucrative forms of investment across the world – and we’re here to talk you through everything you need to know about the process.

Why Invest with Portico from Nigeria?

In Nigeria, managing wealth can be challenging with inflation rates around 28-30%, a volatile Naira, and unpredictable exchange rates. These economic factors limit local options for leveraging property wealth or even securing finance. Portico Invest offers an alternative that allows you to invest in UK property, a market known for stability, low inflation, and growth opportunities.

Compare Nigeria vs. UK Property Investment:

Inflation
- Nigeria: Approximately 28-30%
- UK: 1.7%
- Investing in UK property provides a hedge against the high inflation seen in Nigeria.
Currency Value
- Naira – Volitile
- GBP – Stable
- Protect your investment’s long-term value.
Exchange Rate Fluctuations
- Early pre-launch pricing in UK developments means you secure property below market value
- Potentially offsetting exchange rate changes by capital appreciation over time.
Finance & Equity Options
- In Nigeria, releasing equity from property or securing finance can be difficult.
- With UK property, the ability to release equity over time allows you to reinvest, build a portfolio, and grow your wealth using profit gained from capital gains.

3 Reasons to Invest in UK property

01.

House prices in the UK have increased by over 10% annually for the last 2 years.

02.

Property prices in the UK are set to increase by an impressive 17.9% in the 4 years to 2028 (Savills, 2023).

03.

Rental growth in the UK is set to increase by an impressive 18.1% in the 4 years to 2028 (Savills, 2023).

What are the tax implications for overseas buyers investing in UK property?

Stamp duty land tax (SDLT)

Any non-resident who purchases a property in the UK will be subject to both the standard stamp duty land tax rates, as well as an additional 2% surcharge.

Inheritance tax

Non-UK residents who purchase a property in the UK will be subject to inheritance tax. On death, 40% inheritance tax is levied on the value of all UK situated assets for non-UK domiciled individual’s.

ATED

ATED is a yearly tax payable by companies that own residential property with a value of more than £500,000 in the UK.

Capital gains tax

Capital gains tax is a tax on the profit realised on the sale of a non-inventory asset and is required by both UK and non-UK residents upon the disposal of residential property in the UK.

Income tax

Any rental income you earn on your UK investment property will be subject to income tax. This can be paid in two ways – either earn your income in full and then pay tax through a self-assessment tax return or allow your lettings agent or tenant to deduct the tax automatically.

Frequently asked questions on investing in the UK from overseas

What documentation do you need to invest in UK property?

When it comes to investing in UK property from abroad, there are a few forms of documentation that are required before you can move forward with the purchases to comply with UK anti-money laundering and fraud laws. These checks will usually be conducted by solicitors, banks and the agent your purchase through. These documents include:

Proof of identity – your passport or driving license are ideal
Proof of address – a bank statement, utility bill or driving licence are required
Source of funds – Payslips, tax returns and proof of benefit are among the documents that can be used as proof of source of funds

These documents may be requested at numerous stages throughout the investment so it is important to have them ready from the start in order to avoid any unnecessary delays to the process.

Do I need a UK bank account to pay for the property and receive my rental income in Nigeria?

No, you do not need a UK bank account to pay for your property or receive your rental income. You do, however, need a domiciliary dollar account in Nigeria so you can purchase the property and receive income in dollars. This is because you cannot transfer Naira to the UK. It is important to note that buying a property in the UK does not make you eligible for a UK visa, this is an entirely different process.

How can I appoint a UK solicitor?

We can assist you in appointing a UK solicitor. We have recommended firms who are well versed in the intricacies of buy-to-let property investment. Once you have decided on which solicitor to use, they will require you to sign an instruction letter to confirm their appointment.

Is the investment fully hands-off?

After investing in a property in the UK, you are now a landlord, and as a landlord, you have a multitude of responsibilities that can be extremely overwhelming. We offer a completely hands off service with 3 years free management.

Get in touch with us today.

We’re here to help and discuss your next property investment. Whatever your interest in residential property, we’re here to help. For practical support or just some good common-sense advice, please send us a message and we’ll get back to you.

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