REVERSE MIGRATION FUELS BUOYANT PROPERTY MARKET

In the United Kingdom, the reverse trend of buyers moving back into London after seeking solace in the countryside during the pandemic is still prevalent according to Martin Bikhit, co-owner of Berkshire Hathaway HomeServices London.

“As more people are coming back into the office, many are keeping their country homes but are also buying or renting a smaller London base as they don’t like to commute,” Bikhit explained. “Also, many who moved to the countryside in hope of this wonderful, idyllic lifestyle haven’t really adapted to it, due to, for example, a lack of Michelin star restaurants, art galleries, and things to do in general.”

Addressing the general sentiment among today’s buyers, both overseas and domestic, Bikhit said, “Foreign buyers are still attracted by the relatively weak pound—they are definitely getting more bang for their buck than they were, say, in 2016. Sales to international buyers are up about 25% compared to last year.”

“Domestic buyers are generally affected more by local mortgage interest rates, especially outside of London. But central London buyers tend to be more cash rich, so are therefore less affected by interest rate rises.”

Bikhit explained, however, that a likely general election in 2024 could make things more restrictive for international investors to buy property in the United Kingdom. “If there is a Labour government [after the next election] there is talk of introducing additional taxation above the existing rates on international purchases—as well as a potential restriction on the number of units that can be sold to international buyers on new construction projects,” Bikhit said. “So now is the time to strike, and we are seeing international buyers accelerating their plans in light of this.”

While development is still taking place in the country’s capital, Bikhit noted that they “have a dwindling development pipeline,” adding that, right now, what can be developed, has been.

And local governing bodies are also contributing to the construction decline. “Westminster Council, which oversees one of the major London municipal areas,