Research finds expats head
to Italy for la dolce cheaper
by helen burggraf
Britons living in Italy have
seen the price for a basket
of basic consumables drop
more over the past nine
months than those living
in other preferred destinations,
according to research
by Alliance & Leicester
International (ALIL), the
Isle of Manbased offshore
banking division of
Santander.
But those living in all
the most popular expat
destinations have benefited
from a fall in house prices
– with people based in
Asia and the Middle East
experiencing the sharpest
Guernsey’s Argyll Investments
has launched the
Clarion Property Income
Fund, an openended unit
trust aiming to pay an
annual 4% income.
The fund invests in UK
affordable property, which
Argyll said has a higher
average gross yield than
corporate bonds, cash, equities
or government debt.
Stuart Place, director
and founder of Argyll, said
affordable housing held
many attractions not readily
found in other sectors
of the market, among
them government back
44
decreases, ALIL said.
At the bottom of the
index was the US state of
Florida, where British expatriates
saw prices increase
for all items during the
period – including petrol,
which more than trebled.
ALIL acting managing
director Simon Nuttall noted
the survey showed there
were “significant variations”
in how the global recession
had affected the cost of
living in the most popular
UK expat destinations.
The research compared
the average price for a cup
of coffee, a litre of petrol,
bottle of water, bottle of
beer and a litre of milk,
Argyll Clarion Property Income Fund to
focus on affordable housing in the UK
FuNd Facts
Type of fund: guernseydomiciled
unit trust
Annual mgt charge: 1.5%
Initial fee: up to 5%
Performance fee: 20% above
8% hurdle
Minimum investment: £10,000
ing, little downside risk
due to the nature of the
properties, and growing
demand as evidenced by
social housing waiting
lists increasing.
The fund is advised by
as well as house prices,
in October 2008 and in
July 2009.
Dubai, where house
prices have fallen by more
than 35%, “appears to be
the best option” for Britons
looking to move abroad, a
summary of the results of
the survey said.
Interestingly, Italy managed
to top the list for
expats overall even though
house prices there fell by
only 1.5% yearonyear.
The UK came in near
the middle of the ranking.
Beer and milk prices rose,
petrol and water became
slightly cheaper and coffee
stayed the same.
Ultimate Assets, a property
specialist that advises
on two Eastern European
property funds run by
Argyll. The initial portfolio,
which launched on 1 July,
has 19 affordable housing
properties on fiveyear
leases.
Place said there was
a large pool of further
potential acquisitions, and
highlighted that the fund
would close to new investment
if the net cash flow
yield, before gearing, fell
below 3%.
He added the gearing
policy was “conservative”.
www.international-adviser.com
OPINION
Like it or not, increased
regulation is on its way
The UK’s Retail Distribution
Review (RDR) bears heavily
on two very sensitive
areas for IFAs: income and
qualification.
Productbased commission
is to be outlawed and
replaced by fees agreed
between the adviser and
the client. Advisers must
attain a level of professional
qualification akin
to the current Diploma in
Financial Services.
Where IFAs use the
label ‘independent’ they
must advise across the
whole range of investments
– ETFs, investment
trusts and National Savings
to name a few – not just
packaged products.
Why has the FSA thought
this necessary? Because the
financial services industry
in the UK had become
(with a few exceptions)
a bastion of the sale of
highly charged products by
relatively illinformed salesmen.
Too many scandals
had cost the public (and
the industry) too much.
So will this have an
impact on international
firms? Clearly those based
Graham Barnes, director,
international division,
The Fry Group, believes
IFAs need to prepare
themselves for the
outcome of the Retail
Distribution Review
in the UK will be bound by
the RDR. Those based outside
the UK will inevitably
be impacted in two ways.
There will be a rush
of UK IFAs seeking jobs
overseas rather than face
the burden of extra qualifications.
Clients will seek
more from the relationship
with their IFA. They will
want more than the casual
sale of a product with little
service thereafter. Instead,
“
There will be
a rush of UK IFAs
seeking jobs overseas
rather than face
the burden of extra
qualifications
”
they will look for what
they might have experienced
at home in the UK.
International IFAs will
inevitably face pressures
for change not just from
clients but from local regulators
as well. They can
either hope to make hay
whilst the sun still shines
or ready themselves for a
very different world.
INTERNATIONAL ADVISER [www.international-adviser.com] AuguST 2009
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