LONDON
BY MIKE SMUTS
Safe Haven Destination
Good value on a global scale?
T
he London property market did rather
better than anyone might have thought
du r ing t he recession. In fact, in t he
last decade, L ondon has faced some of t he
most difficult challenges a global city can, from
terror attacks and a banking collapse, to a hung
parliament and an apparent housing collapse. Yet,
London took it all in its stride, shrugging off these
blows like the heavyweight champion of the world
that it is.
Resilient property market
In London, the average price returned to 2007 levels
two years ago. Today it is two-and-a-half times the
national average, at £435,034, and 17% higher than
in April 2013.
The seeming immunity of London’s property
market has long been attributed to be a result of its
status as a ‘safe haven’ – an investment location in
which assets will retain or even increase their value
in the face of turbulence in other parts of the world.
London’s property prices are directly affected by
economic and political factors overseas, according to
new research from the University of Oxford which
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Offshore Handbook 2014
measures the impacts of ‘safe haven’ investing on
London house prices.
Britain has a long and uninterrupted history of
political stability, recognition of property rights and
maintenance of the rule of law, giving international
purchasers conf idence that assets purchased in
London will not be confiscated. Taxes on capital
are relatively low and acquisitions can be structured
eff iciently, so Britain remains an attractive
investment location for people domiciled abroad.
Safe haven
Its reputation as a safe investment, cemented during
the financial crisis and recent periods of political
instability all over the world, means there are today
more reasons international buyers purchase a property
in London than there are stops on the tube map.
Propert y in the UK capital has picked up a
reputation as a sensible place for wealthy people
from around the world to park their cash when
their own countries are going through a period of
instability. It’s an attractive idea, especially given
the undeniable inf lu x of overseas money into
London during recent times.
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