Tag Archive | "London"

Demand for Prime Central London Rentals Cools

The overall demand for rental properties in central London experienced is not nearly what it once was late last year. In fact, the market growth in rentals in prime central London properties was just under one percent in the last quarter. That is quite the drop from the three percent growth experienced throughout the past year.


Economic turmoil and uncertainty are major factors in the decline in demand, as many of those that would be looking to rent the prime central London properties are employed in the financial services industry. As the economy struggles, those in the financial industry are typically less likely to have the money needed to rent an apartment in the prime locations of central London.


While the prime location of central London has struggled during the most recent quarter, other areas are enjoying the fruits of increased demand. Southwest London has been a top performer throughout the quarter, and as such, experienced an increase of more than two percent in the value of the properties in the area.


As more families and young professionals look to secure a rental residence at a more affordable price, it is likely that the most recent trend will continue. Those individuals will look not to central London for a rental, but rather to other areas of London where the rent may be cheaper.


Southeast England has also benefitted from the decline in demand for prime central London properties. The rental market in that region saw an increase of more than one percent in the last quarter, which is a substantial improvement when compared to the four percent decline that it experienced throughout last year.

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London’s Prime Real Estate Market Sees Increased Demand

While economists had originally feared the looking European debt crisis would have an adverse effect on London’s prime residential real estate market, the opposite has been true. Demand continues to be extraordinarily high, as both domestic and international investors are vying to buy prime properties in the city.


The competition and increased demand is nearing all time record high levels, as inventory levels continue to fall. The inventory supply levels are down twenty-five percent. As such, the limited number of available properties has investors willing to pay as much as one hundred thousand pounds above the asking price.


In some cases, residential real estate properties have been sold above the asking price within hours of being listed. The increasing demand suggests that investors have more confidence in the London market than ever before, despite the initially worries of the impact of the debt crisis.


Economists are now labeling the current market in London a seller’s market, as there continues to be growing interest in a limited number of available properties.


Investors are not the only group willing to pay more to get the residential property that they desire. There have been reports of families willing to pay well above the asking price to ensure that they are able to secure a house on a particular street.


It has yet to be seen as to whether or not more sellers will opt to come forth in the current market. Those that are looking to sell in this market, however, are certainly doing well. The combination of limited supply and astronomical interest among buyers has created the perfect storm for London’s prime real estate market.

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London Housing Prices Nearly Hit Record High

The London residential real estate market defied the worries of economists in hitting a near record high in the month of February. Prices jumped nearly two and a half percent to almost four hundred and fifty thousand pounds, or seven hundred and ten thousand dollars.


Prices in all of England and Wales increased by more than four percent this month as well. That increase is the biggest in nearly ten years. While economists had originally feared that the London housing market would start to struggle due to fears related to the European debt crisis, the latest numbers certainly squash any doubts that the market is still performing strong. In fact, overall confidence in the housing market is incredibly strong in the city, and prices will likely continue to rise.


The lack of supply in London’s housing market is certainly contributing to the price growth. In addition, there has been an increase in retail sales, and the economy as a whole looks likely to avoid a second recession. With the positive economic news, the residential real estate market will only continue to improve.


New listings in London’s residential real estate market fell by nine percent in January, The decline in listings is indicative of a seller’s market, as there is a shortage of housing options from which a buyer can choose.


While unemployment numbers are still relatively high, there has been growth in the manufacturing industry. As such, more jobs will be created, uplifting the economy even further. Provided the economy continues its growth, prices in the residential real estate market will continue to rise in 2012.

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Dismal Economy Hurting Property Rents in Central London

Recent data indicates that residential property rents in prime central London have now fallen nearly one percent since peaking five months ago. The rents still remain higher than they were a year ago, though there is growing concern among economists in the United Kingdom.


Rents do typically experience a modest decline during winter months, as many companies opt to wait until the weather gets warmer to begin moving around, and adding positions to their workforce. However, the current outlook on jobs extends beyond the winter months, and many believe the dismal market will continue to impact property rents throughout London.


Employment vacancies have fallen more than fifty percent, and many companies are giving out significantly reduced bonuses in the first quarter of 2012. As such, those renters that would normally rent in prime central London are looking to either pay a reduced rent, or move out of the area.


Corporate rental tenants are also looking to cut back on their rent costs even further than they already have in the past few months. As businesses begin to focus even more on their bottom line, they are looking to cut costs anywhere possible to maintain profitability. It is for that reason that many businesses are looking more than ever to reduce costs associated with renting.


While there is still hope that prime central London, and other areas of the city will be able to avert the looming debt crisis that is currently affecting Europe, the current job outlook and rental situation in the region does not look overly promising.

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Many Commercial Real Estate Investors Shying Away from London Market

With extremely high prices, and the current fears of another recession in the United Kingdom, many investors are opting to stay clear of the London commercial real estate market.

Last year, the British city was considered the top choice out of every European city in the eyes of commercial real estate investors. They have now fallen to tenth, as investors are looking elsewhere for more stable markets.

The stability of the market is certainly one of the driving factors for the decline in investor interest. Prices were still quite high when London placed first last year, but the market was far more stable than it is at this point in time. Investors simply cannot afford to take the risk of paying premium prices anymore when they is a good chance that values will drop in the near future.

Many foreign investors that once favored London are now opting to move their money to Germany and Scandinavian countries, as they are considered to be the most likely to feel the negative effects of a possible European recession. Cities such as Istanbul, Munich, Berlin, and Stockholm have all replaced London as preferred investment targets.

For the past few years, London has competed with New York City as being the most attractive real estate investment location for investors worldwide. Last year, the two cities went head to head in terms of commercial real estate growth, as London attracted some of the world’s richest to establish offices in the prime parts of the city.

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More Asian Investors Buying Offices in Central London

More Asian Investors Buying Offices in Central London

London office properties are looking more attractive than ever to many Asian investors. Asian buyers have more than doubled the amount the amount of money that they have invested in the past year. In 2011, they spent roughly one billion seven hundred million pounds on office property investments, up one billion dollars from the total figure of six hundred sixty-eight million pounds that was spent in 2010.

The large increase in spending played a role in the increase in the group’s market share. Asian buyers accounted for sixteen percent of total investment volume in 2011.

International investors dominated the Central London office sector, as sixty percent of investment volume came from buyers outside of the United Kingdom. Analysts believe that the surge in Asian investment volume is largely due to capital coming from pension funds in Malaysia and Ultra High Net Worth investors from various Asian countries.

The growing interest of Asian investors in the central London commercial real estate sector is expected to continue into 2012. Analysts believe that investment volumes in such markets will further increase beyond twenty percent of total market share.

The majority of these Asian investors believe that central London offers a safe long-term investment that will provide high-income returns. There are already reports circulating that large offers for properties under the ownership of other foreign investors have been made in 2012. More of such offers can be expected throughout the next year.

The surge in Asian investors has played a major role in separating the central London office market from the struggles faced by commercial real estate properties outside of the city.

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Housing Prices Rise Again in London

While the rest of the United Kingdom continues to be faced with a struggling housing market, London has seen its residential real estate market thrive. According to data from the latest report, the London housing market hit yet another new peak in December. Home prices are now as much as seven percent higher than what they were during the peak before the real estate crash.

International investors and buyers provided a major boost to pricing and sales growth in the past month, helping the city overcome the credit crunch that continues to hinder the United Kingdom. Many of the most recent international investors have come from other European and Asian nations. Their interest in the London market has helped the city remain a prime market despite fears of the European debt crisis crippling the rest of the country.

Many real estate analysts are not certain that London’s housing market will be able to sustain its current growth and pricing levels due to the overall economic constraints. However, many of them have been expressing the same uncertainty for months while the market continues to grow stronger.

London is starting to develop a Manhattan-like reputation, in that residential real estate in the prime areas have essentially priced out everybody but the super wealthy. With only the richest international investors being able to afford to buy property in the prime areas of London, most of those who wish to live in the city have no other option but to rent.

As London’s property prices continue to increase, the city has essentially separated itself from the rest of the nation. There is still some doubt that the trend of rising prices will continue, though if history is any indication, it likely will.

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Prime Property Sales in London Slow Down

For much of 2011, the prime residential real estate market in London experienced strong growth. Domestic and international buyers alike bought property as soon as it went up for sale, and it was considered to be one of the safest investments in the European housing market. For the first time this year, growth over the past quarter has been slightly slower than expectations.

Despite the slow down in growth, the one percent increase raised the year’s total growth to just over fourteen percent. The fourteen percent figure marks the largest growth that the prime residential real estate market in London has ever experienced. It is nearly double what it was last year, when total growth was calculated at roughly seven percent.

International buyers made up roughly fifty-five percent of buyers in London’s prime market. Many of those international buyers came from other European nations. The Middle Eastern share of buyers increase slightly in the past year as well. Surprisingly, the number of Chinese buyers in London’s prime market fell to just two percent in the past year.

Within London’s prime real estate market, the ultra-prime market, consisting of the city’s most expensive residential properties, experience unprecedented growth. Ultra-prime properties increased by nearly nineteen percent in the last year.

While property sales have slowed down in the last quarter of 2011, many analysts are not entirely worried about the state of the prime market in London. They do believe that the market is moving past a peak in growth, though there is no indication that prices will fall any time soon.

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Rents Fall for First Time in Two Years in London

For the first time since June of 2009, residential rents dropped in London. Rents dropped one tenth of a percentage point in October, which leads some analysts to believe that the rental market may be nearing its current peak.

The rental market had hit a low point in June of 2009, and since that month, it has experienced an increase of twenty-nine percent. Those that invested in the rental real estate market at that time have taken home more than eighteen percent in annual returns. Despite the recent drop in October, rent prices were up in the city for the third quarter.

Rent prices for prime London real estate continue to push higher, and are closing in on an all-time high. They are now currently two percent higher than their previous peak, which took place in 2008.

One of the factors that has led to rent prices slowly dropping has been the slow down of the job market in London’s financial sector. There are now far fewer jobs available in the sector in comparison to the numbers from one year ago. In addition, tenants have been taking their time on choosing an apartment in recent months, which shows a decrease in demand. In a typical high demand market, tenants would look to sign a lease immediately to avoid missing out on a place.

Many analysts have weighed in on the stagnation of rent prices in the month of October, and believe that it is a sign of what is to come in the fourth quarter of the fiscal year. With that said, rent prices are expected to rise next year as well, though not at the same high rates as experienced during this past year.

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Ultra-Luxury London Housing Market Expected to Hit New Highs

London’s housing market for the super wealthy is expected to experience continued unprecedented growth at least until 2016 according to the most recent reports. Data indicates that the ultra-luxury housing market will see prices rise to more than ten thousand pounds per square foot in the next four to five years.

One Hyde Park in London has been known to be one of the world’s most elite housing markets, and is similar to the super-wealthy housing markets in New York, Monaco, and Hong Kong. Prices for such properties generally aren’t released to the public, though a recent research study has finally shed light on the market.

The anticipated increase in pricing is indicative of the current state of the housing market worldwide. The average housing prices and sales around the world have either faced declines or relative stagnation. On the other hand, the wealthiest housing markets continue to experience strong, if not unprecedented growth.

Prices on the ultra-luxury homes in London continue to grow in demand due to the lack of overall space for similar neighborhoods to be developed. As such, the number of properties fitting the label of ultra-luxury is extremely limited. The exclusivity of these properties has created a serious demand, fueling the strong price increases.

As wealth continues to be generated among the world’s richest sector, it is unlikely that prices in the ultra-luxury markets in London and across the globe will face a downturn any time in the near future. With incredible amenities and overall beauty, the residences at One Hyde Park are absolutely stunning, and it is understandable as to why they command the prices that they do.

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