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PETALING JAYA: The property market in the UK is currently very sluggish and prices are low, according to analysts responding to the move by the Employees Provident Fund (EPF) and Kumpulan Wang Persaraan (KWAP) to acquire their first property there.According to a report by Reuters yesterday, the country's two pension funds had acquired an office building as part of plans to invest up to £1bil in the British property market.
They acquired the office building in London for £156.7mil, translating into a yield of 5.75% and a capital value of £802 per sq ft, said Reuters quoting Jones Lang LaSalle Inc which advised on the deal.
An analyst from a bank-backed research house said Europe's economy was quite bad right now and, apart from Malaysia, other investors were also flocking to the UK to acquire properties. "And when Europe economy revives, the UK is likely to pick up first as it is one of the top cities in Europe," she said.
Another local analyst also shared similar views quoting figures from Bank of England's latest mortgage figure that net lending in the UK, which stripped out redemptions and repayments, was just £112mil in September, down from £1.62bil in August.
It was also reported that lending figures there were unlikely to pick up in the coming months.
as banks restricted the best deals only to borrowers with substantial deposits.
"But, what I say is the yield of 5.75% is quite high," he said.
Previously, EPF said in a respond to query by StarBiz, it had made the decision as it viewed the UK property market as "stable and highly liquid" and one of the world's largest property markets backed by strong laws protecting the landlords.
By The Star
