Top end of the London Housing Market See Sharp Price Falls
The top end of the housing market in London has seen some sharp falls over the last 6 months with some estate agents predicting further falls particularly in Luxury homes. Thgis time last year the high end property market in London was rising faster than anybody had predicted as wealthy international buyers were buying whatever they could get their hands on.
This led to meteroic rises in Areas like Mayfair and Kensington as buyers were outstripping sellers by ten to one. However since then we have seen a serious drop in the oil price as well as international sanctions against many Russian businesses. The housing market was being driven by Russian buyers and these have all but gone.
London has a number of headwinds on the horizon toinclude the threat from the Laboiur Party over the abolisiion of non-dom status, the threat of a Mansion Tax and the possibility of the reintroduction of the 50% tax rate fir high earners. There is also the threat from HSBC and sytandard Chartered that they will leave the UK because of the increase in the Bank Levy and the increase in new regulations that have been imposed on banks by the government.
Not to mention that the Pound has strengthened against the euro. It has risen by 20% against the euro over the last year and this has made it even more expensive for europeans lookijng for a bolthole in the capital.
Optimistic estate agents in London are hoping that the market will start to pick up again once the election is out of the way but some are worried that a Labour government would be looking to increase taxes on some of the city's biggest earners starting with the Mansion Tax. It is fair to say that Ed Milliband is going to be looking at ways of raising much needed cash and the property market will be a good place to start if he grabs power.