Property Investment Prospects Remain Strong in Central London
Despite a marginal slowdown in demand for properties for sale in central London in late February and March, central London still remains one of the most desirable places to invest in property.
Following an extremely good start to the year, the early spring period was rather disappointing for the housing market in central London, with the volume of serious applicants looking at houses and apartments for sale in central London falling.
But the slight decline in demand for properties in central London was not due to the region no longer being a highly desirable place to live or invest in property, but was rather owed to the adverse weather conditions, according to Beaney Pearce. In fact, the central London estate agents actually report that, with weather conditions rapidly improving, far more people are actively looking to acquire homes in centralLondon once more.
“The absolutely ghastly weather accounted for a great deal of the reluctance [in demand from buyers], said a spokesperson for Beaney Pearce. “May and early June however have seen a very marked increase in activity with a healthy level of sales been agreed.” Beaney Pearce’s findings are supported by the latest data from theRoyal Institution of Chartered Surveyors (RICS) which shows that residential property transactions rose in London, along with other parts of the country Transactions in May were at their highest level in three-and-a-half years as house buyers took advantage of record low interest rates, according to RICS. Surveyors sold an average of 17.9 homes in the three months to May – the highest level since January 2010, although still significantly below the levels hit six years ago. What’s more, sales are expected to continue their increase over the next three months with a net balance of 35 per cent more respondents predicting transaction levels will grow, up from 26 per cent. Peter Bolton King, RICS Global Residential Director, commented: “May was an interesting month for the housing market. More people decided to get out there and view property and more transactions went through than in quite some time.” The sharp rise in housing activity demonstrates that more buyers are taking advantage of favourable market conditions, helping to push property values higher in the process. UK home prices rose by 2.6 per cent in the three months to May compared to the same period last year – the biggest rise since September 2010, according to Halifax.
The mortgage lender says that home prices rose by 0.4 per cent in May alone, though down from the 1.1 per cent rise recorded in April. “Despite these recent signs of improvement in the housing market, the subdued economic background and the accompanying weak income growth continue to be a significant constraint on housing demand and activity,” said Halifax economist Martin Ellis. In spite of Mr Ellis’ concerns, the investment prospects for the housing market across many parts of the country, particularly in London, look rather buoyant, supported by various Government schemes such as Help to Buy. Very few investments compare to the safe nature of investing in central London’s property market, according to leading estate agents Sandfords. Andrew Ellinas, Director at Sandfords, said: “Property in London has intrinsic value that is not dependent on buyer sentiment but its use as a place to live and do business in the most vibrant and cosmopolitan city in the world.” With demand for properties in central London expected to increase further, far outstripping housing supply in the process, very few people would argue against investing in the capital’s housing market at the moment.