Residential prices in central London
will continue to experience growth in the long-term, according to a property investment firm that predicts the market will return to normal trends by 2016 or 2017.
London Central Portfolio head of investment management Hugh Best says average market growth will occur before this happens - and there are likely to be significant fluctuations of ten or 11 per cent. He suggested that the central London property sector
was below the long-term norm in the early part of the last decade, with expansion rates standing at around six per cent.
"If you take a slightly longer term point of view and look at the start of the millennium as a seven or eight-year period running up [to] the credit crunch, then actually we had suppressed growth," he explains. As such, house prices were not over-inflated prior to the financial crisis as some believe, Mr Best states.
The market recovered back to where it was before the economic downturn by spring 2010, with prices rising at an above-average rate during this period, he suggests. The comments follow statistics from Knight Frank pointing to an 8.3 per cent increase in London property values in the last year, with a 0.9 per cent uplift also identified for the month of June.
- Tuesday 12 July 2011