London Is Ideal For Property Investment
Why is London an excellent place for property investors to put their money? The number of people living in London is due to rise by 800,000 in the next ten years - and there are not enough properties for sale.
Pressure on land, queues for planning and restrictions on green-belt development mean this is already a severe housing shortage - one can describe this as a housing crisis.
Only seven percent of properties in London are 1 bed flats - there are massive numbers of single people who want to live on their own or with a partner in their own home. Most flats being built are 2 bed flats. Not enough cheap houses are being built.
Properties for sale are required by families, wealthy individuals and couples. Over the last 10 years - many things have worked in London's favour as regards property for sale:
- The harsh Sabine-Oxley regulation put on US companies has driven many investors and companies to choose London as a place to make their base - and trading in London has grown because the regulatory environment is less difficult.
- Many Middle East investors no longer want to use the US after tensions in the last few years - so more money has been entering London.
- London is English speaking and has become a base for a lot of rich individuals who operate their companies and investments from London - they feel that they can trust the environment and they like the quality of financial services. Also there is very little corruption and poor practice is rare.
- The vast mixture of races in London make international people feel 'at home'.
- Many foreign billionaires find their tax very favourable within the UK.
- The law, civil rights and fairness of the society attracts these high net worth individuals. Many foreign billionaires find it an easy way to protect their wealth.
- West London will always be a very popular area for expatriates of all nationalities.
- The West End theatres and quality of entertainment is high - it is a fun and prestigious place in which to live.
- It's easy to visit London and to take up residence if you are a wealthy expatriate - the air links and communications with major cities all over the world and countries are exceptional.
- Safe and secure political status - relatively stable tax and financial regime.
- Huge influx of money from city bonuses and global mergers and acquisitions activity. Because of these reasons, there has been a lot of money coming into London.
Most of the money being put into cheap property comes from overseas - and considered by many a safe haven.
The growth in population, employment, banking and financial services is massive and has lead to strong GDP growth. It's difficult to find statistics - but we believe London's GDP is growing at about 4 percent per annum, whilst the north of England is growing at 1.5 to 2 percent per annum.
If you look at wage inflation running at 4 percent with big city bonuses and very little housing being built - it does not take an expert to work out that prices of property for salewill rise.
Think about this - as interest rates have risen from 4.5 percent to 5.0 percent property prices have accelerated. If the UK GDP comes down and inflation falls to 2 percent, if interest rates then drop to say 4.0 percent - just imagine the impact this would have on the property for sale market in London. Affordability would definitely improve, and prices would rise again. And remember, if the UK GDP is 1.5 percent, its likely London's GDP will be double this at 3 percent.
In the UK there is a dual economy - the north and south. The Bank of England considers both in a weighted sense and would not want the north to drop into recession. So as the north slows, interest rates will drop slightly leading to further price rises in London.
To conclude, because of the emergence of London as the global centre for finance and business, not enough cheap houses are being built, there is an increasing population, high GDP, high employment at present and infra-structure developments (e.g. 2012 Olympics) we see demand for 1 bed flats in central and peripheral areas remaining strong for many years and prices will continue to climb - by 7 percent in 2007.
The author of this article has been involved in property investing for 15 years and also runs a website for property investors.
Property For Sale
www.investalist.co.uk is the UK's No.1 resource for finding cheap houses and investment property
Related Tags: property for sale, cheap houses, cheap property
Your Article Search Directory : Find in Articles
Recent articles in this category:
- 5 Reasons to Buy Jasper Real Estate
Jasper is a small town in North Georgia and it is growing rapidly. Since North Georgia Foreclosures - Ellijay Real Estate
Ellijay Georgia has always been known for it's outdoor activities and seasonal festivals. Downtown E - How to Deal With Blocked Drains
A blocked drain is an occurrence that happens eventually to all households. You may have experienced - The Benefits of Hiring a Plumbing Consultant
Your dream home may not always be brand new, with fresh paint and home essentials. There are certain - The Worst Mistake You Can Make When You Apply to Rent a Home
A whole new class of people has become renters and potential renters in America during the last thre - State of Individual Real Estate Markets
Everybody is well aware of the hit that the real estate market has taken over the past three years. - Thoughts on Avoiding the Landlord Trap
I've heard several people say they would never invest in a multifamily rental property because they - An Idea to Increase the Bottom Line of Your Investment Property
Are you pretty sure that you've already maximized the income coming from your property? If you've cl - Finding the Value of a Piece of Investment Real Estate
There is a lot of confusion about how much investment property is really worth. We'll look at three - Arkansas Land For Sale - Search Engine Optimization and Your Website
If you have Arkansas land for sale and are interested in advertising it on your website I have a few
Most viewed articles in this category:
- How High Did Home Prices Really Go
The U.S. Census Bureau released data on Tuesday that revealed where the nation's hottest markets wer - New Homeowners Tips for Household Safety
With so many items on their ¡°buying a home¡± checklist, few homeowners take into considerati - Truth About VA Foreclosures
Many people now days are finding themselves out of work and not being able to make the mortgage paym - Avoid Rookie Real Estate Investing Mistakes
When Robert Kiyosaki, author of the Rich Dad book series, bought his first property he was, of cours - Finding The Perfect Roommate On Craigslist
Craigslist, Roommates, and The Concerns Craigslist is "great" when it comes to looking for housing - The Forgotten Secret To Selling Property - Simple, Quick And Cheap
Why spend big dollars trying to get people to drive a long way to see your house, when your best pro - Get Amazing Results Selling Real Estate Online
This is the age of the internet. Why not take advantage of the widespread use of the internet to ad - Dallas Real Estate Information
In the United States, Dallas is considered as the second leading state according to the area. If any - The Largest Private Equity Indian Real Estate Deal
In the largest private equity deal won by the real estate sector, Morgan Stanley Real Estate has inv - Fractional Real Estate Ownership
Fractional ownership of vacation ski condos is growing in popularity. Park City Utah a popular ski t