Foreign buyers to keep dominating London property market
Foreign investors continue to reign supreme when it comes to dominating the central London property market, according to an industry expert.
Nigel Ellis, a director at Prickett & Ellis, said that where newly-built apartments are concerned, the majority of these are being sold to overseas investment groups who are looking to boost their portfolios.
Regarding smaller London homes, the UK property commentator noted that these are proving to be good assets and they are mainly being snapped up for kids or for future wealth.
"A lot of things are being sold off-plan to foreign buyers which is probably the main part of the central London market. British domestic first-time buyers are having to buy more in the suburbs," added Mr Ellis.
The expert's comments come after research from Lonres showed that many potential buyers were frustrated by a lack of suitable properties in the capital city in 2011. It found that just 19.5 per cent of agents surveyed had witnessed an increase in new instructions for the last three months of 2011, with 49 per cent reporting a fall.
Prices in prime London went up by 1.8 per cent during the first quarter of this year, and strong demand was continuing, Lonres said.
The organisation also noted that at the top end of the market, non-domestic buyers continued to dominate and flats remained the most sought-after type of property.
"Overseas buyers are continuing to shun the traditional London townhouse in favour of lateral living spaces, parking and security. At over £2 million, it is flats which command a pounds per square foot premium, averaging 20 per cent over houses," said Lonres' report.
Domestic buyers tended to concentrate on the market under £2 million, where houses commanded higher prices per square foot than flats. According to the latest data, houses have maintained an average premium of 24.6 per cent over flats.
"The market over £2 million remained buoyant in the first three months of the year, with prices rising by 2.1 per cent. It remains to be seen whether the new stamp duty threshold introduced in the 2012 budget will temper demand and price growth at the top end over the course of the year," added Lonres.
Posted at 04:29 13/06/2012