Real Estate Investor Magazine South Africa December - January 2014

LONDON BY MIKE SMUTS Looking At London It’s full steam ahead in 2014 S o it ’s of f ic ia l (even i f somewhat unbelievable). The year that was 2013 is drawing to a close and London’s Christmas preparations are in full swing. Decorative lights have been switched on, ice rinks are popping up all over the capital and luxury department store Harrods has unveiled its annual show-stopping window display. And “British steam train” is perhaps the perfect analogy for the London property market over the past few months. in the housing market have mutated into speculation as to whether we are on the cusp of another housing bubble? Most risks faced by the London property market, most particularly around Eurozone default, have receded over the past two years and the market has steamed ahead – pun entirely intended. Bubble trouble? Every year the exclusive Knightsbridge store pulls out all the stops to put on a lavish display, attracting thousands of wealthy shoppers from across the globe. Average prices for prime central London property are over 60% higher than in March 2009 and have risen by 7% in the last 12 months. Between September and October alone, average asking prices soared by 10% from £493 748 to £544 232. Three of the large national estate agencies have already published their forecasts and the rest will shortly follow suit. For 2013 the iconic London shop has been inspired by the classic British steam train, creating a magical Harrods Express that reportedly took 50 people over 500 hours to build and features, among other glamours, an £80 000 evening dress dripping in jewels. 70 Yes, that’s right! Fifty Thousand Pounds. And, of course, precisely on cue, media scepticism over whether there could be a recovery December January 2013/4 SA Real Estate Investor Another sure-fire indication that the year is at an end is the barrage of property predictions for next year coming from the market. There is still disagreement on past performance, let alone future performance, but the good news is that all dispel the theory of another housing bubble about to burst, pointing out that mortgage lending, and as a result, transaction levels, remain far below the heady peak of the 2007 property boom. All also agree that prices will continue to www.reimag.co.za

Real Estate Investor Magazine South Africa December - January 2014 | Page 70