With spring approaching Alex Mackay of Mishon Mackay which has an active marketing office in London, takes a look at how the property market is shaping up as we approach what is traditionally the busiest time of the property year.
The nation, albeit reluctantly sometimes, looks to London for its lead in so many areas of our lives. And property is certainly one of them. What happens in London influences what might happen in the rest of the country – given time. It is the ripple effect.
We naturally seem to look to the capital when gauging when it is best to sit tight or move on. In booms and busts over the past forty or fifty years London has acted as the nation’s barometer.
Yet it is more difficult to see what’s happening now. This time it is different. This is because central London property is acting as banker to so many foreign nationals. While it remains such a stable and even profitable place to invest it is hard to see this trend weakening. It is by no means copper-bottomed but central London has become a market unto itself in recent years and tends to mask the health of the UK property market in general. But even in London this super-market is limited to boroughs like Kensington and Chelsea rather than Tower Hamlets.
While there is so much international uncertainty London should retain its allure as a sanctuary for threatened capital. What average Middle Eastern oil billionaire is not going to invest heavily overseas when his entire region is in the grip of Arab Spring fever? It makes perfect sense.
So London is now, as ever, divided into those who have a lot and those with not such a lot. And it is the latter group, most of us mere mortals, who point a way to what the overall market is up to. Over the past year it has become clear that it is not central London but Greater London and the Home Counties which are leading the way. Not so many Middle Eastern or Russian oil billionaires are investing there – nor Indian or Chinese super-industrialists. It is the comfortable, leafy and commuter-friendly towns that are perhaps seeing the firmest signs of an English spring fever in property.
Will this ripple to other areas of the country in the short to medium term? There are certainly signs of fresh activity in most counties. As London dusts itself down from the banking crisis – helped by some improvement in the Euro Zone and US financial systems – then, for the foreseeable future at least, the London ripples should widen their range and increasingly lap at other areas of the country.