London’s West End property market sees surge of overseas rental demand
Whilst many reports on the London residential property market are dominated by the rising number of foreign and overseas buyers, the West End market is proving quite the contrary with two thirds of its buyers coming from the UK, according to specialist West End estate agency, LDG.
In the last three months, approximately 60% of LDG’s UK buyers were purchasing their main home with budgets of £500,000 to £1 million, whilst 30% were buying as an investment, and of those buying, approximately 75% used mortgages to finance their purchase.
‘Whilst there has been a lot of talk about overseas buyers dominating prime central London, in the last three months we have seen strong demand from UK purchasers, a high proportion of which are looking for one to two bedroom properties,’ said Ben Everest, partner at LDG.
‘Low stock levels and a lack of quality instructions are the main factors driving the market forward. We really notice that the phones start ringing when we list a new instruction that is well presented and in a good location. That said, vendors do need to be realistic about pricing; with the current economic difficulties, buyers are not willing to compromise and over-pay for a property that’s deemed slightly secondary,’ he explained.
On the lettings side, however, it is a different picture when it comes to international applicants. According to LDG’s lettings manager, Javier Carrillo, the demand for lettings is internationally dominated, especially by Greeks and South East Asians, with a high number of enquiries from Hong Kong Asians in particular.
LDG’s statistics also reveal that there is a high proportion of 20 to 25 year olds looking for one to two bedroom properties ranging from £400 to £600 per week.
‘We are seeing a high number of international students who are attracted to the area due to educational establishments such as University College London (UCL), London School of Economics (LSE) and the University College Hospital (UCH). Such is the demand, that we tend to see at least 10 applicants per property, and approximately a two week time period for properties to be let,’ said Carrillo.
According to Everest the high interest from Greeks and Asian’s in the lettings market highlights the difference between the two markets in the West End. ‘When it comes to buying, traditionally wealthy upper class Greeks have favoured Mayfair and the SW postcodes,’ he explained.
‘If there is an exodus of middle class European money from the countries that are in economic crisis, such as Italy and Greece, I think that Fitzrovia will be a prime target. It is already a popular and accessible location and forthcoming developments such as the Middlesex hospital site, the Saatchi Building and the Rathbone Post Office, will help Fitzrovia’s international image,’ he added.