What will London be like in 10 years time?

macaque_2

London is turning into the international equivalent of a Cornish holiday town. A London flat is used by a Malaysian family for two weeks a year is not as valuable to UK PLC as a gainfully employed person.

Part of the reason for the sharp increase is that foreign investors have been piling into the market: According to a recent report in the Financial Times, overseas buyers accounted for nearly three-quarters of new home purchases in central London last year, with more than half the homes sold to buyers from Singapore, Hong Kong, China and Malaysia.

http://www.todayonline.com/business/london-property-bubble-singapore-investors-unfazed

CLAPTON

is 3/4 of new properties in central london as large number ?

Conrad

I oft' said 3 /4 years ago London was seen as a safe haven investment and at the time some posters dismissed this as utter garbage, that the UK was going down a long dark tunnel.

The bears always seem last to latch onto reality.

We're entering an unprecedented era of prosperity, UK will be much admired, but as ever the bearish types will dismiss this claim as I don't have an academics graph to back it up.

Typhoon2000

London has always been pretty multinational. I expect London to be pretty much the same. Matters little if the all the Arabs owning property here are selling to Malaysians or Chinese.
The types of property we are taking about here are never going to be bought by the average guy 'gainfully' employed working hard to house and feed his kids. These properties are bought and sold by people who don't have to work. So they are not kicking anyone out of a home.

Loughton_Monkey

macaque wrote: »

London is turning into the international equivalent of a Cornish holiday town. A London flat is used by a Malaysian family for two weeks a year is not as valuable to UK PLC as a gainfully employed person...

Firstly, in general, the property is likely to be occupied by a gainfully employed person, since it will be rented out.

Secondly, your assertion that the house is not as "valuable" to UK PLC is meaningless. If you add up the increased "wealth" created from the moment a builder buys the land and a few bricks, up to the final exchange of cash, then if the cash flows in from Malaysia or Singapore [rather than from an indiginous UK family] then I'd say that UK Plc has come off rather better.

Although the article says nothing about tourism, if Mr & Mrs Phong want to visit England from Singapore, then who are we to say no? I don't think they want rows of Cornish Tea houses anyway. Noodle bars would be better.

Incidentally, I'm forming a 70% Club. It is a select band of property rampers who aim to celebrate 70% rise in London house prices from their low in 2009. Bookings have provisionally been made for Christmas 2014. Do you wish to join?

HAMISH_MCTAVISH

Loughton_Monkey wrote: »

I'm forming a 70% Club. It is a select band of property rampers who aim to celebrate 70% rise in London house prices from their low in 2009. Bookings have provisionally been made for Christmas 2014. Do you wish to join?

:rotfl:

I like it..... Can I join even though I'm Scottish?;)

noodle_doodle

Dunno if we're entering an unprecedented era of prosperity etc but we do have an undeniable track record of not having a civil war, invasion, revolution or pogrom every 50 years unlike the places these investors come from. The life expectancy of a russian billionaire appears to be on a par with that of a ma.fia boss, either jailed for not bribing the right people or whacked by your own side. I'd want more for my billion, personally, so london it is.

egoode

Loughton_Monkey wrote: »

Firstly, in general, the property is likely to be occupied by a gainfully employed person, since it will be rented out.

Actually most of these properties being bought by those from abroad are not being rented out. There's been quite a few reports about this and only a few apartments in large blocks being occupied. If this continues you will have plenty of housing in London just no one living in it which is a major issue.

Additionally it's becoming quite common for new builds to be marketed abroad before it's even available for local buyers and these aren't always properties for multi-millionaires but ones that average people want and should be able to buy.

Typhoon2000

egoode wrote: »

Additionally it's becoming quite common for new builds to be marketed abroad before it's even available for local buyers and these aren't always properties for multi-millionaires but ones that average people want and should be able to buy.

That's been the case for many a year for the large blocks in London, they are sold off plan many years prior, to those that dont need mortgages so that the developer has funds to build the project. The developer then opens up a sales office and show home and resells the same properties. So whilst the new buyer may be the first one to move into a new flat, the rights to it may have been sold many time before off plan.
Nothing to stop UK folk from buying the same off plan at one of the property fairs, just need to be cash buyers.

Loughton_Monkey

HAMISH_MCTAVISH wrote: »

:rotfl:

I like it..... Can I join even though I'm Scottish?;)

We would very much like to exclude you, but to avoid trouble with the Race Relation's Board we do need to allow you in.

One small requirement, though, is for applicants to know the basic bog standard economics of house prices. For this, you will need a special certificate from the Devon Economics & Sophistry Examination Board who offer simple education over this forum. [Don't worry. It's just a few basic questions about the difference between a boom and a bubble.]

After this, a personal audition of 'groin thrusting' will be required and if accepted, then your name will go forward to the Membership Committee. Knowledge of other cities with high house price inflation is an advantage, but not a requirement.

Slightly_Squiffy

Hopefully a lot more bloody expensive than it is now, so my DH and I can use the equity in the flat we're about to buy as a hefty down payment on a lush house in Wiltshire with a low LTV :rotfl:

In all seriousness though, I just hope we can afford to hold on to our London flat for our children so they will have the option of living here without paying what one can only assume will be astronomical rents.

And whoever said the foreign investors rent out their properties...they certainly do not. I lived across the road from one of the (many) London houses of the Rothschild family. It is a HUGE house nestled down behind the Chelsea Royal Hospital, near the Embankment. It is kept fully staffed at all times 'just in case' (the staff lived in the 5 story house next to the block of flats I lived in). In the 11 months I lived there (working from home) I saw the Rothschild family there for 2 days. Most of these families are so wealthy, any rent they would earn in a year on one of these places would be a drop in the ocean for them, and not worth the hassle of having to then find a hotel when they came to London.

Besides, who lives and works in London and can afford the rent on a 4 bed, 2000 square foot flat just north of Marble Arch? Anyone who would pay that sort of money could afford a palatial home down the road in Fulham or Parson's Green on the equivalent yearly outlay.