Overseas investors prefer multi-property options, says Prestige

Overseas investors prefer multi-property options, says Prestige
Prestige Group, the international property investment company, claims that more property investors are opting to reduce risk by diversifying their portfolios through the purchase of multiple investments.
Commenting on its own research, which showed that the number of investors with multiple properties has increased by 188% since 2003, Paul Coghlan, Chairman of Prestige Group, said: "The international property investment landscape has been evolving for some time. We are finding that investors are now grasping the importance of the two key elements of building a property portfolio: diversification and the power of mortgage finance. The increase in multiple purchasers is an interesting investment trend; it equates to about a third of our experienced investors now purchasing bespoke portfolios rather than single units. It is a good indication of how the Irish overseas property market is maturing.
"Investors should have a diverse mix of investments in all their asset classes and overseas property investment is no different. With signs of economic uncertainty this is a very sensible move that we would definitely encourage people to do. Diversification spreads risk, provides savings through economies of scale, and ensures investors' portfolios are more robust and, therefore, protected against uncertain market conditions."
By taking advantage of lowering deposits (now as little as 10%), investors are exploiting the benefits of finance available on overseas residential property to build seven-figure portfolios, the firm claims. Prestige also points out that long build periods allow investors' portfolios to benefit from capital appreciation secured on the down payment of a minimal deposit while, on completion, guaranteed rental schemes provide added security as the property matures (although the term 'guaranteed' is open to misinterpretation, of course).
The key point is the spread of risk across different countries and markets, however. "For example a typical portfolio could include investments in mature markets such as the UK, which whilst being more expensive than other countries is deemed to be lower risk," said Prestige. "The portfolio would then be balanced by investments in emerging markets such as Poland or Hungary, which have lower prices and are forecast for higher capital appreciation, but have higher risks associated with them. A lifestyle investment is also commonly included, providing added diversification in the form of access to the tourist market."
Prestige, which recently launched its own global trends index, currently offers projects in Poland, Hungary, UK, USA and Portugal.
Prestige isn't the only company promoting a mix of investments, with Property Frontiers about to launch an international property fund for its clients. MacAnthony Realty International also claims that between 40% and 50% of its clients are multi-country investors.