Changing conditions in London’s property market

The property market in London is currently in the throes of a cooling period following the big rise in prices that occurred in the spring of 2014. Latest figures show that prices in other parts of the UK are set to outperform the capital for the first time since 2009. The price of a home in London is expected to fall by around 3.6% over the course of the year while the UK as a whole will see rises of 1.5%. These figures come from the CEBR (Centre for Economics and Business Research).

The cooling of the London’s property market can be traced to several potential causes including political uncertainty, changes to stamp duty and people looking further afield for investment opportunities. High prices also restrict the ability of first time buyers to make a purchase, forcing them to opt for renting or moving outside of the capital.

Falling prices can be a bad omen for property investors looking to make a sale but there are benefits for those with the funds to make a purchase, particularly if they are planning to opt for buy to let. The rental demand means you can make good yields and weather the storm until values begin to rise again in the coming years. 2016 is expected to bring growth of around 2.7%. This will cover the majority of this year’s loses and would set investors up nicely for the coming following year.

Increasingly, investing in London’s property market requires long term focus and patience. Investors also need to be careful in terms of the value of the properties they are looking at, particularly if they don’t want to fall foul of stamp duty. Much of the expected 3.6% reduction in house prices expected this year will come from the prime market so it could see people shifting towards buying properties below the top £937,500 threshold.

If you’re planning an investment strategy for properties in London you should consult a specialist for help and advice. We cover all of the capital and strive to offer a personal service to every client, ensuring their needs are met effectively. Specialising in everything from pre-auction services to property management in Ealing and the rest of the capital, we are renowned as one of London’s finest property specialists.