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London calling

22nd December 2008 | back to article listings BACK    print this article PRINT

Those keen to invest in property will have many ideas of what they want to go for and how to go about it, but as ever it is important to be aware of trends and developments.

For example, those who have long harboured ideas of buying up apartments built in provincial city centres may have good reason to think again, because the recent downturn has hit this sector particularly hard, with many new-build properties lying empty and prices plummeting.

Those looking at particular geographical areas may be interested to consider what the situation may be in London. Last week property portal propertyfinder.com suggested that next year would see the start of a market recovery in some areas but not in London and the south-east, because of the greater direct impact the credit crunch will have had on the financial sector. Others, however, have taken a different line.

Property firm Savills, for example, has suggested the prime London property market will bottom out towards the back end of 2009. It has acknowledged that the market has taken a big hit from the credit crunch, with homes worth £1 million in September 2007 losing 20 per cent of their value. More significantly, the report suggests, those homes having to be sold quickly have gone for 30 per cent less.

The report's author predicted: "These prices are, effectively, next year's, 2009 bargain prices. They suggest at what level the market might stop falling, and give credence to our forecast that average prime central London prices will fall no lower than minus 30 per cent from peak, reaching the bottom probably before the end of 2009."

She added that the prime central London market has traditionally recovered from slumps due to the actions of foreign buyers, which may be likely again next year due to the lower value of the pound against currencies such as the euro.

London also looks like being the location of choice for investors in 2009, according to a survey by property portfolio managers Young Group.

It showed that 33 per cent of investors plan to buy residential property in London during the next twelve months, compared with just eight per cent looking to buy elsewhere in Britain. Furthermore, 36 per cent expect London prices to be the same or higher a year from now, compared with only ten per cent for property elsewhere.

So while not all are confident about the prospects for London property in the next year, it appears there are enough who are to at least make trends in the capital well worth examining for the possibilities and opportunities that could emerge soon.

This is a press release by Assetz also available at http://press.assetz.co.uk/articles/4553.html. Alternatively, please see our full press release archive.

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