London is expected to continue to be a mandatory location for super rich property buyers, partly due to its reputation as a global financial hub and also because of its outstanding schools and universities, it is claimed.
Such attributes act as a magnet to wealthy oversees investors, many of whom purchase apartments/investments in London for offspring to reside in whilst studying in the capital, according to Mark Pollack, director of Aston Chase, and a member of fabricproperty.com that has done a survey to find out what experts predict for the UK Spring real estate market.
‘With the bonus season upon us, St John's Wood represents a perfect location for Canary Wharf based buyers due to the fast Jubilee line underground link not to mention the ASL (American School in London) and the presence of the American Ambassadors residence in Regent's Park surrounded by the largest outdoor sports area in London,’ he pointed out.
‘This is likely to be further compounded by recent events in the Middle East, which will inevitably result in an increased demand for homes in cosmopolitan safe and stable locations such as London,’ he added.
Marylebone is likely to be popular, according to Graham Harris, director of Harris Latner. ‘More and more buyers and renters are finding their way to the area and the result is a fast depleting stock availability of all shapes and sizes. If this continues at the same pace, we predict a rise in Marylebone property values during March to May 2011 of between 3 and 5% and possibly much more for certain types of property,’ he explained.
‘Demand is being generated from the UK and abroad, in particular we are recording an unusually high number of overseas enquiries specifically from investors looking to secure a central London base for use in the future by themselves or their children that can be let in the meanwhile. Typical Marylebone residential rental yields are currently running at between 4% to 5% gross. The rental market in Marylebone is very strong at all levels and in many respects it could be argued that the demand from renters is even higher than from buyers,’ he added.
Trevor Abrahamsohn, managing director of Glentree International believes that investors will return to the market this Spring. ‘Despite the gloomy economic outlook it is my prediction that residential property, the old favourite, is going to be one of the most cherished investments of the year in London, with prices rising by about 5%,’ he said.
‘It looks like interest rates will remain within half a percent of present levels until the end of the year. New developments are few and far between as obtaining funding for them is still very difficult and the planning process is still as strangulated as ever. Buy-to-let investors are choosing residential investment over pensions and, at the same time, rents are rising by at least 10% in London,’ he explained.
'There are fewer and fewer properties available in any price range and that is having an upward effect on prices. There is still time to lock in a long-term fixed rate mortgage and although interest rates will undoubtedly rise over the next few years, if you are in secured employment, there is no better time to invest in your own property and build up a tax free asset that one day could be your pension,’ he added.
Other properties expected to do well include those with access to communal gardens and with parking. Also attributes like a balcony or terrace could be good selling points.
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