Around 25% of London’s new built property market share belongs to Asian investors. This reflects how much interest there is in London developments from these countries. But how has this affected the capital?
Asia’s Influence on the London Property Market
Since the recession, overseas buyers have helped to support our struggling property market, when domestic buyers were hesitant. Investors from China and Singapore realised that their interest in London was not only sustaining the market, but also changing the city’s urban landscape by driving new development styles.
High-rise condo properties, including shared facilities for residents, such as gyms, are logical options for London developers, who must make the most of available space. At the high end of the market, condos were rare in the capital. However, they are common in the East. Therefore, developers are creating plans for these properties, to appeal to Asian investors.
Investing in London property carries its risks, but also, the capital is one of the world’s largest and oldest financial centres. It is known to be popular with investors looking to expand into Europe.
Private investors are welcomed by developers, who are hoping to resolve London’s housing crisis. Overseas buyers can also negotiate good prices and expect high yields due to high demand in the city.
The UK’s relationship with Asia has also strengthened. UK ambassadors have reinforced the country’s economic ties with the East, aware of the potential investment opportunities.
In December 2014, Boris Johnson’s trade mission to Asia was widely publicised. During this, he revealed that the communal space at the centre of the new Battersea Power Station development would be called Malaysia Square, honouring the property developers who made the work possible.
Although more investment leads to more homes, many have raised concerns that overseas investors on such a large scale drive up the cost of property and price out UK investors.
As the population of London is expected to surpass 10m by 2030, UK developers must accept international offers if they are to meet the demand for homes in London and strengthen the capital’s position within the global property market.