Numerous London suburbs are experiencing substantial leaps in property prices, with many having risen by 20 per cent in the last 12 months.
The combination of very low interest rates and a number of government measures to incentivise lending from banks has fired up property prices across the UK – but most notably in London.
Experts believe that recent good news in terms of economic growth is partly due to the pick-up in house prices, and a return of the illusive ‘feel good factor’.
But critics suggest that government schemes such as Help to Buy and Funding for Lending through the Bank of England are over-heating the property market. A credit driven recovery, say some, is not sustainable.
Talk among estate agents, however, is not about a housing bubble. They are making hay while the sun shines, and it appears to be shining on the capital the most. Large properties with good schools and amenities are experiencing 12 month rises of up to 24 per cent in some areas, with many being snapped up in a matter of weeks. Nationally, properties are on the market for an average of eight weeks.
From 2009-2012, London’s buoyant housing market was largely due to overseas buyers who were looking for a safe haven while the euro crisis and the Arab Spring made mainland Europe and north Africa too unstable to keep investments in.
Today, however, the real bidding wars are taking place in leafy London suburbs between ordinary people looking to buy a property.
Unoccupied property insurance
The quicker turnover of properties is likely to see less demand for long term unoccupied property insurance, but as more owners decide to ride the price increases and sell now, interest in the product on a short term basis is likely.
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