The London property market has evidently hit a plateau after sharp increases over the course of 2011 due to increased demand. Due to markets that cannot support investment from the vast majority of the working class, the property value continues to look like a solid investment. A London property researcher from a prominent property division has suggested that over a five year gap, between now and 2016, rental growth is expected to be 20% with a capital growth of 6%. This means to rent property in London, you’re better off securing a fixed contract on your rent now and this means that exquisite property can be kept and as an investment the cherry on the cake is only 5 years away. A full 6% increase on return when talking about such vast sums of money is a massive payoff one shouldn’t underestimate.
Property auctions in London seem to have gone quiet with keen investors holding their cards close to their chest. With little property market movement the value of available London property for sale naturally increases. For example a luxury home in central London is likely to increase in value a full 5% depending on lack of alternative options in the same district. This is a flexible figure and is full determined upon the one London property rule that seems to be gospel right now – less supply, more return on investment.
So who is able to buy London property at this point in time? Well apparently foreign investment is a massive factor presently with most interest and subsequent investment coming from Russia and China. Lack of funding for British homebuyers and developers is putting pressure on the house supply and this feeds into the rising prices which makes lack of funding more prominent – a vicious cycle for any local London property enthusiasts.
London commercial property is a factor to consider now as well even with the residential market seeing a growth in value but a dip in available units. Over a period of 18 months to June this year, overseas buyers spent £6 billion in the London property market; the highest since 2007. It helps to note though that most of this went to properties that were newly developed; which means there is even the slightest growth happening.
The long and short of the London property market is this; if you have property you should hold onto it at least for the next 5 years, if you don’t have property but are keen on investing you should hop in now as growth is bound to occur and finally if you are renting secure a fixed amount for your rent now as this will save you a lot of money down the line. The nature of investing in London property is initially quite difficult with the amount of investment needed, but all signs point to a very stable investment with guaranteed growth.
Sarah Mancini loves her home very much because she has a passion for optimising property. She shares here her tips for the London property market, one she is intimately involved with. She has worked as an agent leasing Luxury property for rent in Westminster and been involved in transactions involving luxury property for sale in Marylebone but maintains her love for new home owners happiness is her greatest joy in her work.