Mr. Christopher Jones from Knight Frank England said that, this year, the London property market began to recover in terms of both sales prices and improved demand. Previously, sales prices had dropped by 20 to 25 per cent in order to be able to sell.
But now, prices reflect a reduction of 10 to 15 per cent as the demand for residences in London is higher than the number of units launched in the market, which has less than 40,000 units while the demand is around 70,000 units. Also, more than 100,000 international students arrive to study each year throughout England, investors have moved in to set up offices for various tech-based industries, and domestic demand is also increasing due to government policies that stimulate the real estate sector.
Real estate buyers in London are mostly comprised of people from China, Hong Kong and Singapore — groups with high purchasing power. Also, especially during this period when the pound has weakened, property prices in London are quite inexpensive when compared to the prices from many years ago. Therefore, the market is even more attractive for foreign investors. The residential area that most investors or buyers are interested in must be near the subway, within a walking distance of 5 to 10 minutes. Also, the building should look new with a complete range of facilities within the project.
Mr. Frank Khan, Executive Director, Head of Residential, Knight Frank Thailand, said that the overall property market in London is constantly growing and more investors are expressing their interest; their objectives are to buy a place for their children to live while studying in London, and to rent out later. Some also buy property as their own residence in the heart of London, which is a familiar area, but the selling price is quite high. The returns are only 1 to 2 per cent. However, properties near the city centre or just a bit further away, such as in Hammersmith and Paddington, are easily accessible to the city; they can be purchased at the same price as a residence in the city centre but they have more living space, which makes them easier to rent out. They also have a high rental return at around 4 to 6 per cent, which makes them attractive to investors.
Within 2019, Knight Frank can close sales of over 21 million pounds from Thai investors – an increase of 100% compared to 2018. Also, there are 16 large investors worth more than 14.6 million pounds, as well as 10 more in the process of negotiations, and one large investor worth 36 million pounds.
