Buying a London property: the things you need to know

  • Written by 
  • 10/01/2014
How much can you afford and where? 2 of 4 Buying a London property

Residents of the United States, please read this important information before proceeding

Please read this important information before proceeding.

The UK property market can be a confusing place. As a whole, it hasn’t grown particularly fast since the global economic crisis of 2007/08, when prices across the country fell dramatically. London, however, is a very different story. Since May 2009, homes in London have gained in value by 35 per cent on average1, with many analysts fearing that this represents a market bubble.

It’s a trend that has been driven in large part by international buyers, who have flocked to the UK capital for a variety of reasons. They see London as not only one of the world’s great cities but also a place where one property purchase could give them a number of advantages, such as:

  • A place for their children to live while studying at university;
  • Somewhere for their family to use for holidays; and/or
  • A potential investment opportunity.

According to London-based property firm Knight Frank, people from outside the UK were responsible for nearly half of all purchases of £1m+ property in Central London in the year to June 20132. As Liam Bailey, Head of Residential Research at Knight Frank, puts it: “The higher share of international demand for new-build property, compared to the wider market, relates to the attractiveness of new-build property for investors who prize convenience and lower maintenance.”

It’s important to remember, however, that London’s property prices are not guaranteed to keep rising, and that there are a number of other costs – beyond the purchase price – that you need to consider before buying a property there.