Is It The Right Time To Invest In London Property?

UK HotelIt has been a long summer of activity and some property investors have started to ask me this week if they have missed out on the London property boom. I told them that in my view there is still plenty to look forward to.

It is only a month or so since I wrote a blog saying investors almost always make money from London property. My opinion on the London property market has changed very little in this time – in my view it remains in an expansion phase.

In fact I would go as far as to say I feel even more optimistic for the remainder of the year and here’s why…

Now before I go into why now is a still a good time to invest in London property it is worth dispelling one myth about the the city’s property market – the Olympic effect.

We have heard a lot on the news about disappointed taxi drivers and bar owners. There are however been businesses that have profited and it is all about location.

The same goes for property investment.

So while the Olympics did have an impact in the short term, investors should be looking at the long term when it comes to investing. The London Olympics did indeed see some short term growth in rentals, yet the overall effect on property prices – even in the East End where the Games were hosted – turned out to be virtually non-existent in the end.

Newham and Hackney actually saw prices fall by 3.8% and 2.25% respectively while others areas have risen spectacularly.  So investors should not be to put off when the long summer of sporting activity comes to an end in the UK capital.

As I say to those uncertain investors, the real driver for London property this year and for the rest of the year will be the Euro crisis. The real attraction is high rental yields.

While the Euro crisis continues to put doubt in the minds of property investors in Europe, many of them will continue to look at London as a safe haven as they have done for the past two years.

The best performing areas of the London property market this year according to the latest report from Knight Frank are Knightsbridge, up 15.8% this past year and Notting Hill and Belgravia which have both seen increases of around 3% this past three months.

Much of this price growth can be put down to interest from Russian, French and Italian buyers who see London as a better place to invest than New York, Paris or even Hong Kong. According to the FT, there has also been interest from pension funds and UK insurer Aviva, who have recently financed an apartment block in Oxford Street.

Another plus for investing in London property is transparency. Investors can be confident that the investment process will be more straightforward than in other countries.

However for those who don’t have millions to invest, there are always hotel room investments

When I look at an investment even in London, I like to make sure it is in the best location possible. There is currently an opportunity to invest in a London hotel close to the docklands and enjoy 10% projected returns on your investment per annum.

Investors can even get 50% loan to value non-status finance and a discount off the original RICS valuation.

So if you don’t have the budget of a Russian billionaire you can still secure your own piece of the action at a fraction of the cost of an apartment in the City of London.

Is London still a safe haven for property investors? Please leave your comments below:

 

 

Kind regards

 

Brett Tudor
Property Expert

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