Fri, 28 Sep 07
For years London has seemed like the best and worst of the property market...
On the one hand, it has been at the centre of the biggest bang in the loud boom of the UK housing market, with property prices comfortably outstripping the national average and soaring astronomically in the central areas, driven by high city bonuses and super rich buyers from overseas looking to buy homes.
In contrast, the high prices, driving even the average house over the inheritance tax threshold, have brought complaints that the residential market is driving out families and pricing more and more people out of the city. It has also raised the question of whether buy-to-let investments are available at a good price.
For this reason, a Daily Telegraph property feature last week suggested buy-to-let investors would be better off looking in other parts of the country, noting the comments of Peter Holden of Assetz, who hailed the potential of a number of locations, including Liverpool, Ipswich and Swansea.
The Olympic factor
With so many locations enjoying renewal, attractive cityscapes, university accommodation and good prices for investors, one might conclude that London can be written out of the script altogether.
Not so, according to the chief executive officer of London Central Portfolio, Naomi Heaton. There is one factor that will lead to many new opportunities for investors in the capital - the Olympic Games.
She said: "There will be an awful lot of new builds around the Olympic stadium and the Olympic village and the long term Government plan for the Olympic village is for it to become affordable housing for key workers."
Not that it is only the east of the capital around the Games Park in Stratford that will benefit; beach volleyball and the triathlon will take place in central London, which will boost the heart of the city as well, alongside other benefits including a "face lift" of the area and the addition of new transport infrastructure such as crossrail.
Shortage of housing stock
However, Ms Heaton notes, there is "almost no new housing stock" in this part of London, with the scarcity bound to increase if demand rises still higher as a result of the games.
The situation for the east end, however, will be very different, she said, noting that "near the Olympic stadium there may be maybe ten thousand units there. So you've got an area where there's going to be a massive stock availability whereas in central London it's going to become an even more scarce resource."
With such availability and prices lower than other parts of London, this could offer the capital bargain investors are looking for.
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