The property market in London was one of the hottest markets in the world not long ago. Over the past several months, however, the market has dropped significantly. Prime central London property values have dropped 8.7 percent for all of 2008 and some 20 percent since September of 2007, when prices were at their peak.
Average property values in London are now around the autumn, 2006 levels, according to property consultants Savills. However, indicators are showing that the market is at or near its bottom and investors should take note.
The recent price drops have provided opportunities for property investors who are looking to get into London, typically one of the strongest markets for real estate in the world. Additionally, the falling pound has made this great city an opportune target for international investors from the US and Europe.
Yolande Barnes, Head of Savills Residential Research, is upbeat about the London market: “In previous downturns, it has always been overseas investors who pulled the prime London market out of the doldrums. An analysis of the combined effects of the housing market and currency fluctuations shows that prime London properties would now cost 50% less to a new Japanese investor and 40% less to a Hong Kong, Singaporean, Taiwanese, Swiss or Eurozone investor. With global bargains like these, the start of the recovery may well be driven by equity rich investment from the Far East or Europe.”
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