“London property prices surged by 7.4 per cent at the start of this year, the fastest annual rate of growth since 2016” according to figures from Nationwide.
They cite a lack of supply and sellers favouring cash buyers who aren’t in “chains”.
Of course, this has come as a massive surprise to economists who only two years ago were forecasting a 16% fall in property prices. Their explanation now is that these gains are seen as a temporary bounce back from the pandemic.
As ever, they are looking in the wrong direction, because they are saying that the excess savings/pent-up demand will be exhausted soon. But if that is the case, then how do they explain this?
“There is a record £1.9tn on deposit in the UK” (Source – Financial Times)
The article goes on to note that this has happened while “deposit rates are at a record low. Keep your money in cash and with UK CPI at 7 per cent you are guaranteed to see its purchasing power fall by over 6 per cent a year.”
Hmmm, would it be unfair to suggest that there is still considerable room for price increases and this is before one even takes into consideration the continued relaxation of lending regulations coupled with the growing influx of international buyers which is still below the average?
Speaking of averages, the general figures you read in the press hide much larger increases (and indeed decreases), so do you know which areas in London and types of properties in those areas are likely to outperform in the next few years?
If not, how do you expect to make a good decision?
“Arguably the most impressive part of the entire service was that Jeremy advised us to buy a property that was 30% under our maximum budget.”
Mr Z Sidek (South Kensington)
Most people approach buying a property in London in a way that almost guarantees that they will not acquire the best property their money can buy (and that’s before they make various negotiating mistakes, so they don’t buy at the lowest price possible either).
If you would like to avoid making the same mistakes, simply call 02034578855 (+442034578855 from outside the UK) or email jeremy@mercuryhomesearch.com.
