Concerns surrounding Brexit are fading while London is expected to remain a key global financial centre.
With the risk relating to London’s position as a global financial hub ‘overplayed’ and the concerns surrounding Brexit fading, Savills expects home values in London’s best neighbourhoods to increase by 20.3 percent in the next five years, reported Bloomberg.
“Whatever the challenge from other cities, London will almost certainly remain a key global financial centre and develop as one of several European hubs for the growing tech sector,” said Savills head of world research Yolande Barnes in a report.
SEE ALSO: Sales of UK homes costing £1mil nearly triples
“Its prime markets will therefore benefit from new domestic wealth generation as well as attracting wealthy international buyers.”
With this, home values in prime central London are expected to remain flat next year, before beginning to rebound in 2019, ending a slump which saw values fall 15.2 percent from its 2014 peak, said the Savills report.
Prices in other prime areas that are less reliant on foreign buyers, on the other hand, are forecasted to grow by 10.2 percent over the five years through 2022.
Savills data showed that the number of owners who slashed prices to sell houses worth over £1 million soared 90 percent during the first half of 2016.
This comes as London luxury home sales have been hard hit by Brexit uncertainty, successive tax increases and the June snap election.
The report noted that Britain has 394,000 properties worth over £1 million, 63 percent of which are located in London.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
