Trump effect could bring London’s property market back to life
President takes office in the New Year.
However, the Trump victory was something of a shock to the political system and it could result in a prolonged period of uncertainty and downward pressure on the dollar. It could be that whatever happens to the dollar, there are likely to be American investors looking to buy in Europe and London is the obvious choice as a safe haven.
It is not just Americans whose property buying habits could be changed by the Trump victory. Foreign buyers, particularly those from the Middle East and of Muslim faith could choose to invest in London. Trump’s thoughts on Muslims are well known and wealthy Arab real estate investors are unlikely to want to put their money in the US property market.
New York and London are historically rival property markets for property investors so the US election result could be good for London. The Australian property market could also benefit as it too is regarded as a safe haven for property investors. However, it does have more restrictions on overseas buyers than markets like the UK.
The US election could also result in a change in buying habits for South Americans who have traditionally bought in places like Florida, with Portugal the obvious other market as well as London.
Estate agents in London believe that the election result could see a rise in Americans buying in St John’s Wood, Kensington and Chelsea in London as these locations are convenient for American schools. However, others point out that Americans have never been prolific buyers in London and can be put off by complex tax liabilities, but they could be keen to rent.
It is also possible that Americans may look to buy if they believe that the dollar will weaken significantly when Trump starts implementing his policies such as on immigration and trade. London ticks the boxes in terms property market in cultural city.
So, the Trump effect could bring the prime property market in central London back to life as it has been hit by stamp duty change and to a lesser extent Brexit. This will, of course, have an effect on the rest of London as prices will rise and those priced out of prime will look lower down the ladder.
On the face of it a sudden influx of buyers, from American or elsewhere, might not be great for the London property market, pushing up demand which in turn will push up prices at the top of the housing ladder which will then permeate down to first-time buyers. So the Trump effect, if it comes to be, might not be the great news that everybody wants. of a being a strong thriving multi-