London continues to be consistently recognised as a top global centre for finance, higher education and cultural appeal, something which continues to draw in tourists and international property buyers from far and wide.
Current figures from Knight Frank show that demand in London remains strong and the number of new prospective property buyers registering in the UK was 10% above the five-year average in February and the number of offers accepted was 42% higher.
The prime central London property market in particular far outperforms any other in the UK when it comes to international buyers, with recent statistics from Barclays showing that almost half of all purchases in the UK’s capital city are now made from overseas.
In the wake of a global pandemic and economic and political uncertainty, the London property market has continued to prove its resilience in the face of adversity by drawing in prospective buyers from across the globe.
Leading UK property developer, SevenCapital delves into the top four ways London continues to attract international buyers:
1.Long term capital appreciation
Property prices in London have grown considerably over the last ten years, with data from Land Registry showing the purchase value of the average residence in the capital city has grown by over 66% since 2013, increasing in value from approximately £322,324 to £535,212.
With house prices showing no signs of faltering, and with property always considered a relatively safe investment, the London property market offers a strong outlook for long term capital appreciation, despite concern regarding current UK market conditions.
2.Strong rental yields
With demand continuing to outweigh supply, rental price growth remains at a record high, with average rents in prime central London rising by 17.8% year-on-year in October 2022, and prime outer London a comparable 15.4%, according to Rightmove.
The average gross rental yield for prime central London for October was 3.72%, the highest recorded since 2011, while in prime outer London it sat at its highest since 2013 at 3.74%.
Looking ahead to 2023, these findings are further supported by recent figures from Savills which show that London remained the region with the greatest annual rental growth at 14.2% in March 2023.
For those looking for to put their money into property, London continues to be a sure bet in the rental yield stakes with the average property asking rent in London sitting at £2,343 pcm at the end of last year and strong demand for rental properties still dominating the capital in 2023.
3. Strong demand for the British education system
According to figures from Erudera, the UK is the second most popular nation for international students worldwide, with over 679,970 international students opting for the UK in 2022. In fact, University College London has the highest number of international students, both from EU and non-EU countries, with a total of 24,145.
The British education system has a lasting reputation of having one of the highest education standards globally, something which continues to draw in international buyers looking to capitalise on the crème de la crème of higher education.
4.Desirability of London as one of the top global finance, business and cultural centres
London and the UK continue to excel on a global stage in innovation and sustainability – ranking as joint first for its world’s leading financial centre in figures by the City of London Corporation. With over 40% of the City of London’s workforce coming from overseas, it shows no signs of dwindling in popularity with international buyers.
For tourists, London also continues to prove popular with global visitors with figures from VisitBritain forecasting a total of 35.1 million visitors in 2023, 18% higher than 2022 with a combined estimated spend of £29.5 billion.
With world class brands, 96 Michelin stars across 74 restaurants and enviable retail, leisure and cultural pursuits, as well thriving a financial business centre, London continues to draw in buyers from far and wide – something which will continue to have positive repercussions for the city’s international appeal and buoyant economy.
Buying and investing in the London property market has always been a popular choice for international buyers and we expect this to endure as it continues to prove its strength and resilience in the latter half of 2023 and beyond.
SevenCapital has been making significant moves into London over recent years, with a number of high profile residential-led sites in the pipeline, including, notably, its joint venture partnership with MARK on the £500m development at 100 West Cromwell Road in Kensington. Find out more and register for updates on this fantastic development.
For more information on SevenCapital visit www.sevencapital.com