As high-net-worth individuals migrate to London and the Channel Islands, many are employing the expertise of specialised buying agents to help find the perfect property. Gemma Long investigates this growing trend
It"s not gone unnoticed that there"s been a migration into the UK of high-net-worth individuals (HNWIs) from the Middle East, Far East and Russia in recent years, and that these individuals have high expectations when it comes to property.
Filthy rich or not, moving to a new location brings with it plenty to think about - what area should you choose, what about schools and amenities, and what about the practicalities, such as finding and viewing properties and dealing with the legal aspects? Obviously when you have a considerable amount of money, other questions such as security and privacy also come into play. And do you plan to live there all the time, some of the time, or is this more of an investment property?
There"s been an increasing trend for cross-border investment in residential property according to Iain Johns, Group Head of Private Client Services at JTC Group. “The UK, and London in particular, has traditionally been considered a safe haven for property investment due to a transparent market - it"s politically stable, has a clear rule of law, an independent judiciary, the benefits of foreign currency exchange for international investors plus world-renowned schools and universities,” he says.
He adds that according to the Knight Frank International Residential Investment in London 2013 report, overseas buyers invest in new-build properties in London primarily for investment (65 per cent), while a third of investors purchase property for their children"s future, with tertiary education as the key decision-making factor.
Whatever the reason, the mega-rich aren"t going to spend hours on Rightmove and then fly in and spend days meeting with estate agents, trolling around Chelsea to find that ideal London home. As a result, HNWIs will engage the services of a buying agent - and for a number of reasons, according to Sarah Conway, Head of Real Estate at law firm Maurice Turnor Gardner in London.
“You find with foreign buyers that they"re not often in the UK so they don"t have the time to come over for a week, to go to estate agents, research potential properties in their price range or area, and make appointments. This is what they are looking for in an agent - someone who will do all the legwork.”
Conway says a good buying agent will also have access to off-market properties, a good relationship with selling agents and will arrange a tour of as many as 20 properties in a single day. “The buying agent will also help negotiate a price for the client, because they may not be used to dealing in UK property,” she says.
Jo Stoddart, Managing Director at Quintessential Relocation Consultants, with offices in Guernsey and Jersey, says discretion is key to the role of a buying agent. “A lot of clients don"t necessarily want people to know they"re moving. It could be that they"re selling a business, or doing something highly confidential, and therefore may have approached a buying agent to research the properties for them without giving their contacts or estate agents a name.”
Doing the legwork
When it comes to acquiring the services of a buying agent, there are a number of routes you can take. Conway says one is through referrals and recommendations. “Every situation is different - it really depends on how much the client plans on spending, where they want to buy and the type of client. We wouldn"t have a particular agent we would recommend, but instead we would give a number of names to our clients.”
If you"re seeking a buying agent without a referral from, say, a property lawyer, there are organisations and associations for residential property finders. “A lot of it is word of mouth, particularly at the higher end,” says Stoddart. “But that being said, people do find us from all over the world having searched for a buyer"s agent on the web. Let"s put it this way - we wouldn"t put an advert in the Sunday Times.”
As well as potentially buying a property, HNWIs may use a buying agent to seek out the best options for them in the rental market. Stoddart says it depends a lot on the jurisdiction the client"s looking at. “In the Channel Islands we seek out quite a lot of rental properties for people because they are most likely to be completely new to the island and don"t know the best school catchment areas, for example.”
London is not alone in attracting wealthy individuals and families. Guernsey and Jersey also attract HNWis who need a helping hand when it comes to selecting the right property. Stoddart says she works with clients from all over the world who want to make the Channel Islands their home, from as far away as Canada and South Africa. She has UK clients relocating to the islands too.
“Wealth managers develop close relationships with their clients and when they say that they should speak to a certain person, a client will do so because they value the opinion of their wealth manager,” she explains. “When they come to the islands we want them to think that Guernsey and Jersey are fantastic places to live, and if we"ve made them feel welcome, we feel we"ve made a positive impact on how they set about their new life here.”
Conway says the only downside to using the services of a buying agent is the fee, but that"s far outweighed by the benefits of doing so - and let"s face it, these people can afford it. “Clients pay the fee to ensure they gain access to relevant properties and it allows them not to have to run around. I don"t think there are many downsides,” she says.
When searching for a buying agent, it"s worth seeking counsel from your wealth manager or lawyer, as they will most likely have experience in looking after clients who seek not only the best in high-end properties, but most importantly have knowledge of buying agents with a strong reputation, great relationships with estate agents and the utmost discretion.
Buying agents in action
High-net-worth individuals will often seek a new location to call home when there is an opportunity to, say, sell a business elsewhere - or they may benefit from relocating to an offshore jurisdiction.
Whatever the reason, many seek out their new home discreetly, says Jo Stoddart, Managing Director at Quintessential Relocation Consultants. “I helped a couple who didn"t even tell their family that they were relocating until after they completed the deal,” she explains.
“I was approached by them in August 2014 as they were considering relocating to Jersey, but very much wanted the search to stay under the radar. They asked me to find a selection of properties to look at, and on the second day of their trip to the island they saw a property they fell in love with - it was still being built and was yet to receive any marketing. I knew about it because a Jersey contact had told me about it about a year earlier.
“I went and had a look at it when there were only holes in the ground and followed the development closely. My client would never have found the house without my insider knowledge and connections - they wouldn"t have even heard about it without speaking to someone like me. My client and the family moved in to their new property in Jersey in time for Christmas.”