There is no denying that there are many positive aspects about life in London, and no matter what is important to you, there will be something that ensures this is the city you want to live in. However, given that there are some or even many things that appeal to you about life in London, there will be reasons that appeal to other people, and therefore, there is so much demand for property in the capital. You can see from the level of foreign interest and investment in London that the English capital is where people want to be, but have you been affected by this elevated level of demand?
The fact that London Mayor Sadiq Khan has proposed a “first dibs” policy, helping residents of London to buy property is an indicator that moves are being made to limit foreign investment. If property is not being bought by people who live in or around London, there will be an opportunity for foreign buyers to purchase property but tis move could transform the market.
Foreign investors operate at all levels of London property market
Of course, there is a tendency to believe that foreign investors are only interested in high-end property, leading many to think that they haven’t really been affected by these moves. Then again, in a series of interviews where the first dibs policy was discussed, Sadiq Khan discussed the fact that foreign investors were active the more affordable region of the London property market.
There is also information provided by Kings College London, based on data from Land Registry, which suggests that foreign investment has led to a rise in property prices across the capital. This makes sense but given that so many factors influence the market, it has required thorough analysis to state this conviction with greater belief. The findings state that in the past 15 years, foreign investment has caused London property prices to increase by more than 20%.
Property prices have risen in London, but many factors may be involved
The research centred on the average price of property in 2014, utilising sold property prices from Land Registry, with this figure listed as £215,000. A comparison was made with prices from 1999, with these prices listed as £70,000. The report then suggests that without the support of foreign investment, the average price of property in 2014 would have been listed as £174,000 and the difference between the actual and expected figure was the difference that could be attributed to foreign investment.
With this study suggesting that the average price of property in London has risen by £46,000 because of foreign investment, it is likely that some people will not be pleased at the level of influence this style of investment has had on the market. Of course, not every area of London is affected or feted in the same way, with most people associating areas like Kensington or Chelsea as the locations you will find the strongest level of foreign investment in the capital.
There is no denying that foreign investment has led to property prices in London rising, but it is far from the only factor. A wide range of influences have shaped the London market and ultimately, it is not as if anything can be done to change what has happened. The fact that there is now an open debate about finding ways to help local people obtain property will be welcome by some, but no matter the situation, the London property market will remain the leading component of the UK property market.
If you are looking for information and guidance that is tailored to your needs and requirements, come and speak with Oaks Estate Agents. We may not be the estate agents that brokers high-end property deals for major investors, but we are the estate agents that make a difference in Streatham and surrounding areas. If this is an area of London you have an interest in, with respect to buying, selling or letting, get in touch and we will be happy to assist you.