House buyers could see property prices in some of London’s most desirable areas plummet by as much as 50 per cent if the euro zone collapses, a leading property development firm has warned.
According to a new report released by Development Securities a full break up of the euro zone could be “the single greatest risk” to luxury property prices in the capital, but what does this mean for buyers wanting to invest in the city?
Over the past few years I have witnessed first hand the struggles of many people trying to get on the property ladder. In the grip of the financial downturn, affordable mortgages were hard to come by and many people were forced to put their property dreams on the back burner – so this could be good news for those still keen to move.
London is home to many of the most desirable residential spots in the country and a drop in prices could be positive for those who were previously priced out of the market. I’ve seen prices spiral over the past few years – in fact prices in many of the prime spots in the capital are currently at an all-time high – and it is hard to see how they can get much higher before the bubble bursts.
Other legal professionals have probably noticed, as I have, the impact that foreign investment has had on the UK property market and London specifically. Figures in the report attributed London price increases of as much as 75% to investment from Europe and the Middle East, but these buyers could soon be deterred from investing if property loses value, leaving less competition for movers.
Falls in prices could make once-unobtainable areas more within the reach of buyers searching for a home in the capital, but even if priced much lower than usual, homes in prime London spots will still be costly. It is therefore more vital than ever for buyers to seek the right legal advice before committing to any purchase.
Michael Darlington works for Colemans-ctts, a firm of solicitors with specialist knowledge of the housing market gained from years of experience offering conveyancing services. They have offices in Cockfosters, Kingston upon Thames and Manchester. Visit their residential property page here: http://www.colemans-ctts.co.uk/services/property/residential-property/.
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