PROPERTY PRICES IN LONDON ARE ON THE RISE, AS IS FOREIGN INTEREST IN BUYING A PIECE OF THE CITY. Tamsin Bradshaw FINDS OUT WHY, AND WHICH AREAS ARE HEATING UP
The london real estate market is running hot, particularly at the luxury end. The cumulative value of the city’s real estate is second only to that of Hong Kong in a comparison of leading cities, with wealthy investors pumping US$676 billion into the market, according to international design house Candy & Candy’s latest report on trends in prime real estate.
“The London market is very strong. It’s back to pre-recession pricing,” says Andrew Hawkins, international residential associate director at Savills. “It’s an interesting place for people looking to buy second, third and fourth homes, from an education point of view, for the clarity of the legal system there, and the real possibility of capital return on your investment.”
The British capital is also attracting investors because of its exciting cultural offerings, such as a huge variety of theatres and the arts, as well as great architecture and design. “I’m also struck by the infrastructure that has developed since the 2012 Summer Olympics,” says Hawkins, citing the high-
frequency, high-speed Crossrail due to start operating in 2018 from Reading in the west to Shenfield in the east. Barts Square, a new development in the City of London that Savills is responsible for selling, will be next to one of Crossrail’s ticket gates.
Barts Square is just one of many new luxury residential projects changing the city skyline. These include Kensington Row, Great Minster House and Riverwalk in Westminster, the award-winning Gazzano Building in Farringdon, and The Heron in the City. And they come with all the amenities a buyer could ask for, including gyms, spas, pools, parking and 24-hour concierge services.
The flurry of activity is nothing new, says Hawkins. “There’s always something happening in London in terms of development. Even in the downturn, there was still a good amount of development. You can always see cranes somewhere in London.”
Certain areas are gaining traction. One, St James’s Park, has been overlooked in the past but is “undergoing a renaissance,” says Susannah Odgers, director of period house sales for Hathaways. “These streets have begun to attract a young and fashionable buyer, who can recognise the area’s proximity to some of London’s most iconic institutions.”
Marylebone is another area growing in popularity. “In the last 12 months, Marylebone has seen house price growth of 14.9 per cent, which makes it the best-performing prime central London area,” says Simon Hedley, of London estate agency Druce. “This is certainly, in part, due to the opening of the ultra-fashionable Chiltern Firehouse, launched this year by international hotelier André Balazs.”
A district popular with Chinese buyers this year is St John’s Wood. Aston Chase has reported three sales in the area to Chinese nationals, from £7.95 million to £17.95 million. “St John’s Wood is renowned for large period properties on leafy roads a stone’s throw from the West End and many of the city’s top schools and universities, which makes the area highly attractive to Asian buyers,” says director Mark Pollack.
While London has plenty of appeal, there is a downside. A mansions tax on properties worth £2 million or more may be levied after next year’s election, Middleton Advisors says in its June 2014 research report on London, Hong Kong and New York.
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