Does London Still Represent An Opportunity For Property Investors In 2019?
Traditionally London has been a safe haven for property investors looking for an ironclad investment in the United Kingdom. The property prices in the city seem to be self-correcting – even when the property in the rest of the United Kingdom seems to be taking a pummeling London sales on seeming above all the fuss and bother. That is not to say that there have not been highs and lows since the days of the financial crisis – but prices in the city and the areas immediately surrounding its core seem to always stage a comeback – and sail serenely on. However, the wobbles of Brexit aside, there is still a pretty mixed bag when it comes to the attractiveness of London as a property investment as we enter the final six months of 2019.
The average house prices in London continue to fall – but there are hotspots within the city that are bucking the trend. Many of these hotspots are in the city proper. The powerhouse of finance and services that keeps London ticking over as a global financial hub. However – statistics can be misleading. According to some industry pundits, the reason that central city properties seem to be almost immune to the general malaise that is facing London property may be a simple matter of numbers and valuations. There are fewer properties sold in the area – and those that are sold boast sky-high purchase prices. the result is an average sale price and returns on investment that may not provide the most accurate picture regarding the attractiveness of London as a property investment destination.
However, even the prime central zone of London where most foreign investment takes place has taken a hammering since the last reporting period. Homes in places like Chelsea and Kensington (in the central zone) are down by nearly 15%. The culprit, to no one’s surprise, is the uncertainty caused by the ongoing Brexit muddle. However, this has had another knock-on effect. Local consumers are wary of property investment at the moment due to worries over the strength of the domestic economy.
However, even taking into account the low numbers of properties that are sold in the City of London borough it remains a shining beacon. Property prices in this area have not only bucked the trend – they are set to shatter the ceiling. House prices here have risen by an astounding 16.2% over the last 12 months – and this in the face of Brexit and increased stamp duties. Yet another example of the resilience of property in this part of the city.
However, the falling prices in the rest of London are not all gloom and doom for everyone. First-time house buyers may soon start to realise that the lower prices present an incredible opportunity. The same might be said for savvy property investors who may come to the conclusion that increasingly tough economic times may bolster the rental market as people hold off on outright purchase. The latest news around the London market may just be a cloud with a silver lining for some investors.