Singaporean investors are pouring money into British bricks and mortar, new figures reveal.

Landlords based in the Asian financial powerhouse have become the biggest source of overseas rental payments, accounting for 17.1% of all international transactions.

Hot on their heels are property investors from Switzerland, who take second place, contributing 16.2% of payments, according to the latest data from rental payment specialists PayProp.

And in a sign that Britain remains a magnet for overseas cash, Hong Kong rounds out the top three with landlords there responsible for 15% of international payments.

UK Property A ‘Significant Opportunity’

The flood of cash from abroad comes as no surprise to experts, who say high rents and stagnant property prices at home are making the UK a tempting prospect for overseas buyers.

Neil Cobbold, Commercial Director at PayProp, said: “Overseas landlords represent an important segment of the UK rental market.”

“With millions of pounds of rent from UK tenants remitted overseas, this market represents a significant opportunity for UK estate and letting agencies prepared to work with landlords in other markets.”

And with some domestic landlords selling up, he believes investment from overseas will become even more vital in propping up the UK lettings industry.

Tax Breaks For Foreign Landlords

The figures are likely to raise questions about the tax breaks enjoyed by overseas landlords. While UK residents pay tax on their rental income at rates of 20%, 40% or 45% depending on their earnings, non-residents are taxed differently.

For individuals, the basic rate of tax is applied to rental income, while companies and trusts pay at rates ranging from 19% to 25%, according to UK Property Accountants.

Mr Cobbold called on the Government to re-examine the current system, saying: “The current tax regime for overseas landlords could lead to them paying less tax on rental income than an equivalent UK landlord, and it is time for the government to consider equalising these rates.

“This would help encourage domestic investment to complement the interest from overseas.”

Navigating The UK Market

But while the UK property market holds huge appeal to those living abroad, navigating the system can be a daunting prospect.

The complexities of the non-resident landlord scheme and a raft of other regulations pose a challenge for would-be investors.

However, help is at hand, according to Mr Cobbold, who said: “For overseas landlords, engaging a letting agent’s fully managed service is not just a convenience but an important insurance policy.

“Having a team of UK-based property experts to help them navigate international payments, tax issues, right-to-rent checks, anti-money laundering laws, EPC certificates, local licensing, and other regulations the landlord may not be familiar with is essential.”