By Shabnam Muzammil:
The price increase of luxury residential properties in London over the last few years seems unsustainable according to Grosvenor Group, which owns most of the city’s upscale Mayfair and Belgravia districts.
As investors look for refuge against the Eurozone debt crisis and political instability in the Middle East and Russia, high-end home prices in London have surged by 53 percent since 2009 compared to 25 percent in Greater London, according to Knight Frank.
The capital’s robust property market also attracted many commercial developers such as Land Securities and British Land, while Grosvenor has even converted offices into homes.
“The extremely high rate of growth over the last two, three years is a thing I’m concerned about and I think it’s probably unsustainable,” said Grosvenor’s CEO Mark Preston.
“As those crises recede then perhaps there’s less interest in capital moving internationally for safe haven reasons. (And) we’re reaching values in prime London that are just extremely high by historic standards.”
Meanwhile, Knight Frank noted that London is the most expensive city to buy a residential property at £2,540 (S$4,812) psf after Monaco and Hong Kong.
Shabnam Muzammil, Senior Journalist at PropertyGuru, wrote this story. To contact her about this or other stories email shabnam@propertyguru.com.sg
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