The state of play of the London property market is always a hot topic and none more so than at this year's MIPIM; the world's premier real estate exhibition, conference and networking event which is held annually in Cannes, France.
Predictions on how house prices will fare in the coming months, the strongest areas for investment in London and where the international buyers are coming from are always key questions to ask when looking at the current state of the UK market.
The weak British pound and low interest are two factors that have appealed to overseas buyers when targeting new property in London, especially when you consider that the property has been able to hold its value, with research from Savills revealing that property prices in prime London had risen by 4.6% over 2010 despite the economic downturn brought on by the recession.
More stock is also becoming available on the market in London, with prime new developments offering a wide variety of choice to international purchasers across areas such as Knightsbridge, Mayfair and Kensington.
Harrods Estates, the luxury property division of the Harrods Group, are one company who specialise in the sale, let, acquisition and management of some of the most exclusive prime properties in central London and have strong relationships with international clients, who account for 87 per cent of sales and lettings at their two offices in Mayfair and Knightsbridge.
According to further research from Savills, 48% of all prime central London buyers over the last five years are from overseas. The buying trends from overseas have seen an increase in the number of Asian investors (from Singapore, Hong Kong, Malaysia and mainland China), with strong demand also coming from the Middle East, Russian and a number of other countries throughout Europe.
With so many desirable areas in London, it gives the buyer plenty of choice for luxury living in the UK capital and also provides scope when looking at the price ranges investors are buying at. During 2010, 58 per cent of Harrods Estates sales were in the £1-3 million price range, 22 per cent in the £3-5 million price range, 12 per cent over £5 million and 8 per cent just below £1 million.
Shirley Humphrey, Sales and Marketing Director at Harrods Estates, comments: “There has been a significant shift in international interest from buyers looking for property in London and increasing interest from Asian buyers.
“In 2010, we saw a marked rise in levels of Asian buyers, which means they are now our biggest single group of purchasers. They accounted for 44 per cent of sales in 2010, which is a huge increase when compared with only 7 per cent in 2008.
“In many cases now, Asian investors are buying homes for their children to live in while they are studying at university in the UK and then retain the property as an investment. Last year, Middle Eastern buyers accounted for 25 per cent of sales and Russian buyers accounted for 8 per cent of sales, which was at a similar level to Europe at 9 per cent.
“Despite there being a lack of stock in some of the desirable areas of London, people are still continuing to buy here, which means that the demand and prices will continue to grow.”