London home price bounce back slightly

London home price bounce back slightly

29 Jun 2019

London home prices

Brexit uncertainties have dominated the London property markets but the prime central London property continues to rank one of the top assets of the last 30 years as per Knight Frank report.  Many investors from Asia are keeping a close eye, seeking investments in the UK capital city due to the presence of traditional drivers like education, historical links, and long-term capital growth. People are concerned about Brexit but the situation has posed opportunities with low pound rates where the overseas buyers are looking for homes in Central London, Manchester, and Birmingham.

The house price increased 5.2 percent to May in 2019, and this was one of the fastest growth since January 2017 as per Halifax. The Bank of England data suggest the UK housing markets were stagnated by the Brexit related uncertainties, but the UK mortgage picked up in the month of April, which was slightly higher than the average of the last half-year, and the report suggests the increase was mostly driven by the mortgage approvals for such purchases. Even the RICS reports find the prices have been bottoming out in recent months. The market was sharply hit by the Brexit referendum in June 2016 but the situation is improving, where the regions in the southwest of England is showing weak development on the price movement, even as, the capital city has bounced back a little.

Historical value

Historical streets like the ones owned by British Royals or French Royals - the Seine or a Maltese villa and the imperial palace are some areas where investors are keen to get a property.  A survey of 2015, found 43 percent of the locals wanted to live in the streets, which indicated a connection to the royalty.

A number of studies on London properties find the commercial real estate in prime central London that was bought in 1989 at £100 would now deliver £575 as per Knight Frank reports. The residential property has always offered some of the best opportunities to investors; similarly, the farmlands are most lucrative where farmland bought for £100 - 30 years ago can get up to £476. Farmland provides tangible opportunities where the prices have been climbing significantly in comparison to other collectibles like furniture and jewelry. 

Volatility in asking price

The gap between the asking price and the price at which the homes are selling was 3.9 percent less in the first three months of the year – as per Zoopla studies. In London, the asking prices and selling prices have been fluctuating significantly depending on a number of factors by an average of 5.7 percent lower than the original asking rate. The website claims the weak market and difficult negotiations have cautioned buyers, on the contrary, the homes in Glasgow and Edinburg were selling at an average price higher, in comparison to, the asking rates, and uk house price index the demand for housing stock continues to increase in these regions. Edinburgh rates were 6.3 percent higher than the initial listing rates and Glasgow selling price was 5.2 percent higher than the original price. 

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