London is widely recognised as the home of the rich and famous as the streets are lined with some of the most desirable homes, but these come at a cost. Recognised for its higher quality of living, luxury lifestyle and opulent housing, property investors have long viewed the capital as an opportunity to source lucrative investments. Over recent years, London’s shine has begun to dull leaving property waning as less people are prepared to pay the extortionate costs of living in prestigious London postcodes. An arising question is that perhaps London’s escalating prices are expecting too much, as high property prices and higher rents have resulted in a large volume of London properties failing to meet their asking prices.
One house in Mayfair that entered the market at £25 million was eventually sold at nearly half the value at £15 million. To put this into perspective, the property was purchased in 2014 for £19.75 million, but the owner failed to complete mortgage repayments and the property was eventually repossessed. £10 million difference shows a significant decline, which could have been due to numerous factors from the bank wanting a quick transaction, or more likely the fact that even those accustomed to the sharp costs in London are even struggling to pay for the London way of living.
In London, soaring costs are apparently more justified by a range of amenities on offer.
Former stately homes, grade I and II listed buildings, and old Victorian townhouses provide a contrast against the modern state of the art apartments, both of which are becoming more unreachable.
Private rooftop gardens, home cinemas, home spas, and wine cellars are just a small selection of luxury amenities that boost the appeal of London homes.
However, despite a large injection of money investing into revamping and upgrading London properties, most homeowners are being encouraged to keep hold of their properties to save themselves for a substantial loss.
International investors often take advantage of the fall in the pound but those from overseas are still reluctant to entrust their money in London property, forming the judgement that London prices are still extortionate even though the price of the pound works in their favour. Property investment companies like RW Invest are increasingly seeing investors less keen to buy in London property and are becoming a lot more enthusiastic at the prospect of investing in the North, boasting higher rental yields and lower entry prices.
Houses in London are down 1% from last year as well as a large proportion of London boroughs registering annual price falls. England’s capital is one of the most suffering regions in terms of house price growth as a huge range of properties are failing to sell for the larger price tags set.
Falling London prices help to highlight just how well other areas of the country are doing within property.
There has been an abundance of negativity surrounding London’s house prices, and the combination of poor rental yields and changes in stamp duty on higher price point properties have had an overall negative effect on confidence in the London property market. Although London is an attractive location for those wishing to source a luxurious property, there are plenty of other areas within the UK that can offer the same style of house with a dramatically cheaper price tag.