Certain parts of the capital, notably areas like Newham, Woolwich, Enfield and Bromley, are experiencing significant property price growth at present – in spite of 2016’s political uncertainty.
However, the same cannot be said for Central London. The combined effect of increased Stamp Duty and Brexit has caused property prices to stagnate and in some prime locations, drop considerably. Here’s some more information, plus the implications for those looking for investment properties in London.
£1m+ Properties Hit Badly
As you might expect, most properties in Central London are costly, and it’s not uncommon to see houses coming to market priced at £1 million or more. It’s this price bracket that was hit hardest by George Osborne’s Stamp Duty changes last April – and they’re still feeling the effects now.
The 2016 Stamp Duty overhaul particularly targeted those buying houses worth £1 million or over, with a significant hike to the transaction levy, leaving many investors much more out of pocket. Understandably, this change resulted in hesitancy amongst investors, and many looked to other, cheaper properties as a way of avoiding the high taxes.
The result? Prime Central London properties, once hugely sought after by investors, are now remaining on the market for far longer. This is causing property prices to stagnate, and in high-value areas like Chelsea and Kensington, drop noticeably.
Slowing Sales… Property Investment Opportunities?
According to data, sales of high-end apartments in Central London have fallen by over 80% since last spring. This is due to reduced confidence in the market, combined with reluctance to pay out the higher Stamp Duty taxes.
However, this market lull is good news for savvy investors. As prices fall or stagnate in certain areas, opportunities arise to purchase a property at a reduced price, which may prove lucrative in terms of long-term capital growth. Likewise, the buoyant rental market in the capital means a plentiful supply of tenants, and a good monthly income generated from rent.
When is the Right Time to Invest in Properties in London?
Of course, it’s impossible to say with any certainty what the property market will do over this coming year. However, experts predict that prices in Central London will fall to such an extent that property investors will be looking to purchase again, which in turn, will drive prices back up. For those who have already invested in property in London, this means a solid ROI.
If you’re looking for buy-to-let property for sale in London, it’s important to do your research first, and work with an experienced property investment agent, who will be able to guide your search and help you find the right property at the right price.
The Buy2Let Shop Limited
Investing in properties in London makes excellent sense at the moment, and can generate both a solid rental income and longer-term capital growth. If you’d like to find out more about searching for buy-to-let property for sale in London, and are seeking an expert property investment agent to assist with your search, get in touch with The Buy2Let Shop today.