“Although we have seen a turbulent month with the shocking rioting scenes and the stock market plummeting, the indicators are that the attitudes of the wealthy remain the same; London is a safe place in which to invest in property. It is still deemed secure and stable, and wealthy international families still want to send their children to school here.
“The Prime London market continues to be driven by foreign buyers, with 50% of property priced £2m and above purchased by international buyers in the last year. In particular, Middle Eastern, Indian and Russian buyers are all currently active in the top-end market place. Most of these buyers are seeking a trophy asset, but there is less to purchase as there is no need for those who have bought in the last couple of years to sell – this means it’s harder work finding and securing the right property.
“Demand also continues at the lower end of the Prime London market (£1m-£3m), although, there is more stock on the market in secondary locations, and those looking in this price bracket will consider alternative locations (for example, North Kensington instead of Holland Park) in order to secure the house they want.
“There is also more activity on the open market (as opposed to ‘privately’) as sellers want to test the market. There does still appear to be a gap between the price the vendor wants to achieve and what the buyer is prepared to pay, with vendors and agents trying to push the price per sq ft values up. However, the buyers who are currently in the market are serious, and some are not concerned about paying more in a competitive situation, once they have seen what others are prepared to pay. This does drive prices up – according to the most recent Knight Frank index (July 2011), Prime London property prices have risen by 9.6% over the last 12 months and are now 35% higher than the post-credit crunch trough in March 2009. We expect that price rises will continue as we head into the autumn market.”
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