London Real Estate News

Tax future house price bubbles, Bank of England tells Treasury

2009-12-08T08:49:00.000+02:00

A leading Bank of England policymaker has called on the Government to raise taxes to prevent housing booms in the future.

Adam Posen, an independent member of the Bank's Monetary Policy Committee, said in a speech yesterday that the authorities should seek to limit house price bubbles because of the damage they inflict on the rest of the economy when they burst. He also suggested that property speculators and second home owners be subject to additional restraints.

Adam Posen, an American economist who joined the MPC this year, said: "Real estate bubbles tend to have much higher real economic costs than equity bubbles, perhaps because they involve illiquid collateral and local spillover effects."

Mr Posen suggested that real estate taxes, which include stamp duty and capital gains on properties apart from a main residential home, could be used as "automatic stabilisers" – rising during a boom but falling in a slump.

Qatari firm buys U.S. Embassy building in London

2009-11-04T16:02:00.000+02:00

LONDON, England (CNN) -- The U.S. State Department has sold its London embassy building to a Qatari real estate company, the embassy announced Tuesday.

The signing of the deal is another major step in the embassy's plans to relocate from its longtime headquarters in central London to a new site in Wandsworth, on the south bank of the River Thames.

It wasn't immediately clear how much Qatari Diar Real Estate paid for the embassy building in Grosvenor Square, whose 1960s facade was recently given listed status, meaning its design can't be changed.

Latest uk govt figures show property prices reach five year high

2009-09-06T08:16:00.000+03:00

Residential property prices in England and Wales have reached a five year high, according to the latest land registry figures with others reporting a strong demand for prime real estate in London.

The Land Registry, which records all completed property transactions and is widely regarded as producing one of the most authoritative house price reports, says that prices increased 1.7% in July, the strongest monthly growth since July 2004.
It compares the price of properties sold now with the price paid when they were sold previously. But it does lag behind data from lenders and repossessions and property transfers following a divorce are excluded.

West of England showing real estate market recovery

2009-08-06T01:49:00.000+03:00

West England showing property recovery

The West Country is leading the property recovery in England with parts of Somerset, Wiltshire and Devon showing positive growth, according to a new report.

A comparison of property prices performance in the last six months compared with the last half of 2008, also shows that the north is struggling the most but affluent areas like Cheshire and Suffolk are also amongst the worse performers.

North Somerset leads the way with prices up 1.4% this year followed by Wiltshire, up 1.24%, Plymouth up 0.77%, Bath up 0.39% and Oxfordshire, up 0.08%, according to the report from Zoopla.co.uk, a leading house price information website.

U.K. Housing Market Improves as London Survey Shows Increase

2009-07-15T10:57:00.000+03:00

July 14 (Bloomberg) -- The U.K. housing market improved last month as more London real-estate agents and surveyors said home values increased rather than fell for the first time in 20 months, the Royal Institution of Chartered Surveyors said.

Across Britain, the number of respondents saying prices dropped exceeded those reporting gains by 18.1 percentage points, the highest reading since September 2007, RICS said in its monthly survey released today in London. The balance for the capital became positive for the first time since October 2007.

London's luxury property market ticks up

2009-06-29T22:24:00.000+03:00

New property stats: rich investors opt for top-end London, a popular city for well-heeled South African residential real estate buyers.

In another sign that the world's well-heeled are finding property an attractive and relatively safe bet, the latest residential figures for super-prime London properties shows prices rising for the first time this year.

Investors Back in Market for British Real Estate

2009-06-20T17:18:00.000+03:00

Investors returning to the battered British commercial property market are snapping up offices and shopping centers for 75 percent less than at the peak of the market in 2007, according to the real estate adviser DTZ.

That decline was less than the 89 percent drop in the United States or 80 percent in the Asia Pacific region. But in Britain, the speed of the decline was faster — transaction volumes shrank 51 percent in the three months after their peak compared with 35 percent in the United States and 19 percent in Asia.

Some analysts said this rapid correction was now helping the British market recover faster than those in New York, Tokyo or Frankfurt.

Bahrain's Salam buys London property worth $220 mln

2009-06-14T17:21:00.000+03:00

MANAMA, June 14 (Reuters) - Bahrain-based Islamic bank Al Salam said on Sunday it acquired London's Milton Gate office tower from UBS Triton Fund in a deal worth more than $220 million as Gulf Arab investors return to Western property markets.

The bank said in a regulatory statement it acquired the property in partnership with privately owned investment house Evans Randall.

It said it expected the investment to generate cash yields of at least 10 percent per year, and that it was considering further private equity and real estate deals in Europe.

Gulf Arab investors have been holding on to funds for months after the region was caught up in the global liquidity freeze late last year, but are now buying into Western real estate again to benefit from lower valuations.

U.K. Homebuyers Bet Property Recovery to Be Illusory

2009-05-22T17:00:00.001+03:00

May 8 (Bloomberg) -- Nyasha Kuwana won’t be taken in by signs of recovery in Britain’s battered housing market.

“I think the market may get worse,” said Kuwana, a 29- year-old insurer who put off her search for a one-bedroom flat in West London earlier this year. “I will be no worse off buying in six months.”

A 17 percent slump in prices since their peak last year and the lowest interest rates in the Bank of England’s history have stoked optimism among banks such as UBS AG and real-estate agents that buyers will soon return. Mortgage approvals rose to a 10-month high in March.

Rents Crashing in London to 1991 Prices Le Gavroche Shows Gone

2009-05-17T15:15:00.000+03:00

May 14 (Bloomberg) -- Anyone driving a BMW 3-series convertible in London probably knows the price has doubled since 1991. A three-bedroom home in Chelsea fetches almost three times what it cost 18 years ago. And at Le Gavroche, the two-Michelin- star menu favored by bankers since the Big Bang of the 1980s, dinner will set you back 33 percent more than you paid when Margaret Thatcher was prime minister.

It’s another story in the City of London, where office rents in the U.K.’s main financial district are falling to 1991 levels as job losses and a mistimed building boom depress prices.

House prices 'up by the end of the year'

2009-05-11T01:37:00.000+03:00

U.K. Commercial-Property Decline Slows, RICS Survey Shows

2009-05-05T17:04:00.000+03:00

May 5 (Bloomberg) -- The rate of decline in demand for U.K. office and retail space eased in the first quarter, the Royal Institution of Chartered Surveyors said, suggesting record-low interest rates are helping shore up the market.

The net balances for enquiries, demand and confidence were the least negative in a year with the industrial sector the most improved, the Coventry, England-based association of real-estate professionals said today in a report.

“The improvement in the market offers some hope that aggressive cuts in monetary policy have provided some limited support for the commercial markets,” RICS said.

A net balance of 40 percent of surveyors reported a drop in new sales and lettings to occupiers, compared with 71 percent in the fourth quarter.

U.K. House Prices Edge Up as Buyers Return

2009-04-23T20:45:00.000+03:00

LONDON -- As the U.K. government prepares to announce provisions to address the housing crisis, prospective buyers are returning to the market but many are stopping short of making purchases.

Some U.K. house builders have reported sales growth this year, and reports by the Royal Institution of Chartered Surveyors and others suggest that both sales and mortgage approvals rose slightly recently.

More people also viewed homes in March, and prices have edged up. Lender Nationwide Building Society said the price of a typical house increased in March for the first time since October 2007, rising 0.9%, reducing the annual rate of decline to 15.7% from 17.6%. Bank of England figures show an increase in mortgage approvals in February.

But industry observers said the rise in house prices could be temporary. Prices still are at historic lows, and there is little evidence that the market is stabilizing.

U.K. Property Slump Eases as Buyers Return

2009-04-18T22:25:00.000+03:00

April 15 (Bloomberg) -- The slump in U.K. house prices eased last month after more than a year of declines lured buyers back into the market, the Royal Institution of Chartered Surveyors said.

The number of real-estate agents and surveyors saying prices fell exceeded those reporting gains by 73.1 percentage points in March, the lobby group said today in London. That compared with 78.1 in February and was the highest balance in 13 months. The average number of sales per surveyor rose for the first time since 2007, climbing to 9.7 from 9.6.

The report adds to signs the property market’s downward spiral is slowing. The Bank of England has cut its benchmark interest rate to a record low, mortgage approvals increased in February and Nationwide Building Society said prices rose for the first time since October 2007 last month. At the same time, the economy is still battling the worst recession since at least 1980, and prices may fall further in coming months.

London's Luxury Real Estate - Bloomberg

2009-04-15T18:49:00.001+03:00

West End office rents fall 11.8 percent

2009-04-10T00:28:00.000+03:00

The amount of empty offices in London's City financial district has risen by a tenth since the start of 2009, pushing the total amount of vacant space to more than 10 million square feet.
A report from broker NB Real Estate on Wednesday showed the total available City office space was now more than 10 million square feet for the first time since 2004 as more businesses downsize to cut rental costs following job cuts.
The available office space equates to about 37 of the iconic "Gherkin" building in central London.
NB Real Estate said City office rents fell by 9.5 percent last quarter to 47.50 pounds per square foot, but the fall in City office rents has been outstripped by an even faster deflation of rents in London's West End business district.
Rents in this area, once heavily populated by high-spending hedge funds, have fallen 11.8 percent to an average 75 pounds per square foot in the last three months, against a third-quarter 2007 peak of 135 pounds per square foot.

Smaller drop in London real estate sales seen as a good sign

2009-04-03T20:02:00.000+03:00

It's a sign of the times when a 7.2% drop in sales is seen as good news in the London area real estate market.

The London St. Thomas Association of Realtors (LSTAR) reports 551 detached homes and 118 condos sold in March. The total sales of 669 units is down 10.2% compared to 745 in the same month last year.

LSTAR president Joe Hough said the 7.2% decline in detached home sales is a big improvement over the 35% overall drop seen in January and 30% in February.

"When you look at what's going on in other markets, a 7.2% decline isn't bad. I'm almost thrilled," said Hough with a laugh.

Hough said prices have also remained relatively stable despite all the bad economic news in recent months.

A Middle Eastern real estate company has opened an office in London

2009-04-01T00:14:00.001+03:00

Dubai-based Landmark Properties has opened an office in Mayfair to hunt out real estate opportunities for its Middle Eastern clients, claiming exchange rates alone have made London property 25% more affordable in the last six months.

John Michael, manager at Landmark Properties UK, said: "If you live in the United Arab Emirates or elsewhere in the region, there has never been a better time to invest in London properties - the exchange rate is in our favour and the Bank of England base rates are at an all time low of 0.5%, therefore excellent rates can be achieved for clients based outside of the UK."

Michael said London properties were highly sought after by Middle Eastern investors as they had undergone several peaks and troughs and but the market remained one of the most proven and mature worldwide.

Your $32 million takes a village in England

2009-03-25T13:09:00.000+02:00

LINKENHOLT, England (AP) — Sheep dot green hills. Pheasants hop across country lanes. Quaint cottages sit next to a tiny stone church. Neighbors who've known each other since birth greet strangers warmly. And for about $32 million, this leafy, nostalgic slice of England could be yours.

The village of Linkenholt's 21 cottages, grand manor house, lush green cricket pitch and accompanying pavilion are part of an estate that also encompasses 1,500 acres of farmland and another 425 acres of woods.

The entire estate is for sale — as a whole — with the only part not on the block being St. Peter's, built on the site of a 12th century church.

"That," said real estate agent Tim Sherston, "is owned by God."

Having an entire estate become available is "very unusual indeed, particularly in the south of England," Sherston said. "I can't recall the last time a village came up for sale."

London Police Probes Bulgarian Dreams Real Estate Agency

2009-03-23T10:31:00.000+02:00

Bulgarian Dreams, a London-based estate agency that folded last year, is being investigated by the City of London Police Economic Crime Department, the Sunday Times reported.

"We have received a number of complaints about Bulgarian Dreams and have begun an investigation," a spokeswoman said. She confirmed that the company closed its Moorgate offices at the end of 2008, but could not comment further.

Founded and owned by Robert Jenkin, a Cambridge graduate, and his Bulgarian wife, Mariya Georgieva, the company sold flats and houses at more than 40 developments in Sofia, the capital, in ski resorts such as Bansko and Pamporovo, and on the Black Sea coast.

A message on the Bulgarian Dreams website says that the company has ceased trading "following the extraordinarily difficult economic conditions" and suggests those who bought property through it should contact the Bulgarian developers directly.

European property market may not recover till 2012

2009-03-17T08:57:00.000+02:00

“It is important for financing problems to be worked out, and for price cuts to come into force,” Benoit du Passage, head of Jones Lang LaSalle for southern Europe. “If access to financing is freed up ... that would be very good for the market,” he said.

Morgan Stanley, and Germany’s Allianz among others, are predicting discount purchases in the second half and in 2010, in low-risk markets like London, where there is liquidity and where average prices have plunged more than 37% since the June 2007 peak.

“London has seen the strongest reduction in values since 2008. I’ve seen meetings (at MIPIM) and I’d be surprised if they didn’t come to something,” Mark England, chief executive for BNP Paribas Real Estate unit Atisreal said. (Reuters)

Russian buyers back in London

2009-03-13T13:52:00.000+02:00

Tempted by lower prices, rich Russians are back snapping up prime London properties - and it's slowing the fall in the market there, say real estate brokers.

Compared to its peak back in March 2008, prime real estate in London has fallen by almost 23 per cent. That, coupled with the fall of the British pound, puts buyers with U.S. dollars and euros at a distinct advantage.

Since most Russians with substantial wealth stash their hoard in dollars or euros, they have not been as hard hit as you might expect from the dwindling rouble. Indeed, buying property in Britain still seems to be a very attractive option for those with money to spare.

U.K. RICS Home Sales Fall to Record Low

2009-03-10T20:21:00.000+02:00

March 10 (Bloomberg) -- U.K. housing sales dropped to the lowest since at least 1978 as the recession pushed prices down further, the Royal Institution of Chartered Surveyors said.

The average number of transactions in a survey of real- estate agents and surveyors dropped to 9.5 per respondent in the quarter through February, the lowest since the data began three decades ago, the group said today in London. The gauge of house prices fell last month to minus 78.3 from minus 76.6 in January.

The number of new homes being built in Britain may fall to the lowest since 1921 this year as the recession deepens, the National Housing Federation predicted today. The Bank of England cut its key interest rate last week to 0.5 percent, the lowest ever, and said it will buy assets to replenish banks’ balance sheets and encourage lending.

Standard Life sells property holdings

2009-03-03T11:36:00.000+02:00

The Edinburgh-based company may invest as much as another 100 million pounds ($142 million) in stocks, Andrew Jackson, head of property strategy, said in a Feb. 27 interview. Land Securities Group Plc, British Land Co. and Hammerson Plc plan to raise 2.1 billion pounds to avoid breaching loan agreements.

"We think rights offers will be the catalyst for a rally in the U.K.," said Jackson, who expects the advance to start by the end of June. "We will be putting the money in a number ofmarkets including the U.S., where we have been terribly underweight, and support some of the rights issues in the U.K."

Property has slumped 38 percent since reaching a record in June 2007 compared with a 77 percent plunge in the FTSE All-Share Real Estate Index, which peaked in January that year.

U.K. House Prices Drop Annual 10%

2009-03-02T12:40:00.001+02:00

March 2 (Bloomberg) -- U.K. house prices fell the most since at least 2001 last month as rising unemployment and a dearth of loans discouraged buyers, Hometrack Ltd. said.

The average cost of a home in England and Wales declined 10 percent from a year earlier to 157,000 pounds ($223,000), the London-based property researcher said in a report today. Prices slipped 0.8 percent from a month earlier, led by Wales.

The economy contracted at the sharpest pace since 1980 in the fourth quarter and joblessness rose to a 10-year high in January, intensifying Britain’s yearlong property slump. The Bank of England will probably lower the key interest rate to a record low this week to help the country out of recession.