Central London residential property, often previously described as one of the three or four leading performers in the world market, has been hard hit by the global recession.

Lanice Steward, MD of Anne Porter Knight Frank, which has an association with Knight Frank, the international property management and sales group, has drawn attention to the latest Knight Frank review which quotes Liam Bailey, KF’s head of residential research, as saying,

“Prices for the best properties in the capital are now almost 20% below the peak they reached in 2008.”

Houses worth over £10 million, said Bailey, are now down only 8,1% but homes costing £1 million to £2,5 million are down 22% in value.

Further drops seem likely as the total number of sales for £1 million plus properties is down by a staggering 49%. Bailey, in fact, estimates that overall values will fall to 30% below the 2000 level – but he does point out that price declines are now beginning to slow.

What does this mean for South Africans?

It means, said Steward, that the next two to three months will offer unprecedented opportunities to buy in London, especially as the rand has, despite misconceptions on this subject, performed very satisfactorily.

“The rand stood at R13,6113 to the pound on the 2nd January last year,” said Steward, “on 2nd January this year it was at R13,5919 – almost exactly the same level as a year ago.” Steward was quoting figures from x-rates.com.

Steward said that she does not expect London property to regain its former values in a hurry – KF estimate that £1 million plus sales will this year be below 3 000, the lowest turnover in 20 years – but London property, she said, must still be rated as one of the prime investment avenues in the world and a recovery here, she predicts, will become evident from the end of this year onwards.

Article from: www.anneporter.co.za