EDINBURGH has been revealed as the top UK target for Middle East property investors, according to industry experts.

Research by IP Global, an international property investment company, states inquiries from Middle East venture capitalists in properties in the Scottish capital have surged from 8% in 2023 to 33% this year.

Inquiries into Edinburgh have overtaken the “Northern Powerhouse”, as the Scottish city has dethroned Sheffield and Manchester which drew the most interest from overseas investors last year.

However, Sheffield, York, and Manchester are still proving highly appealing to UAE and Saudi buyers as more than half of enquires to IP Global are about the three areas.

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According to Zoopla, a UK residential property website, Edinburgh ranks as one of the top three UK markets for property price growth in 2024.

The city is also renowned for its cultural and historical significance and draws millions of visitors every year.

However, the Scottish Government called a national housing crisis in May as house prices soared across the country, as well as the UK.

William Page, head of global sales of property investment company IP Global based in the Middle East, said: “Despite a challenging and uncertain economic environment, and the prospect of a new Government, the UK property market remains an attractive market for investors from the Middle East due to the persisting undersupply of housing, which continues to drive up property and rental prices.

“Historically, London has been seen as a safe haven for overseas investors.

“However, many are now seeking attractive investment returns elsewhere. Last year, the Northern Powerhouse drew buyers away from the capital, with Manchester and Sheffield becoming highly attractive property markets offering very healthy rental yields and capital growth.

“This year, Edinburgh has leapfrogged the Northern Powerhouse region as a prime destination for property investors, driven by its growing economy, strong job market, and rising property values.

“A 2023 back-firing rental cap, which was quickly scrapped due to unintended high rental price growth, solidified Edinburgh's position as one of the UK's strongest rental markets.”