With the pound performing at a historical 37-year low against the dollar, the UK’s real estate market is becoming a more and more attractive proposition to US investors.

The new tax measures unveiled as part of the UK’s mini budget and the knock-on effect of embarrassing U-turns and policy reversals means the British Pound is weaker than it has been in nearly four decades.

US investors are now able to maximise their budgets due to the favourable exchange rate as £1 (on the 18th of October) was worth $1.13 – a historic low.

At the same time, the US has experienced mounting borrowing rates, well ahead of the UK and as part of the same mini budget, the UK has cut stamp duty – a tax you might have to pay if you buy a residential property or a piece of land in England or Northern Ireland over a certain price, which has significantly lifted the threshold for millions of buyers both at home and overseas.

While US investors like any other overseas buyer will still see a 2% stamp duty surcharge, the new stamp duty cuts and discount on UK property due to exchange rates outweighs the additional taxation and US investors are getting ready to make a move.

It won’t be the first time either.

According to the Office of National Statistics, the United States controlled the highest inward Foreign Direct Investment stock in the UK on both an immediate (£479.2 billion) and ultimate (£699.8 billion) basis in 2020. Statistics also showed that American companies usually invested in the UK through Japan, Ireland and Canada but with today’s exchange rates and stamp duty cuts, we can expect to see more direct investment in the UK in the coming months especially given US Family Office’s precedent with real estate.

According to our Global Family Office Compensation Benchmark in 2020, 68% of Family Offices in America were invested in real estate and moving into 2021, a further 24% of US-based Family Office professionals told us that they believed real estate would generate the most wealth in 2022.

Thinking ahead to 2023 and we expect both of these figures will dramatically increase as US investors close in on the UK real estate market to make prime and discounted investments.

Will your Family Office be investing in the UK property market in the coming months?