This page has been archived and commenting is disabled.
London Real Estate Prices Soar 68% In Five Years: Here's Why In 1 Chart
Overnight, UK property consultancy Knight Frank reported that London property prices rose 7.5% annually, modestly slowing from 8.1% in March 2013, and 11.3% March 2012. Slowing you say? Not really, and certainly not at the high end: "London sales over £1 million accounted for 22% of the £4.7 billion total in the 2012/13 tax year, while sales over £2 million made a 15% contribution. Transaction volumes in both price brackets represent less than 2% and 1% of the total, respectively" Knight Frank reported. But really putting it into perspective is the observation that on the 5 year anniversary of the centrally planned, HFT-rigged market ramp, London real estate prices have risen by a stunning 68% in the 5 years since March 2009.
Why? Perhaps the breakdown presented below, showing that London is nothing more than a hot money parking lot, with Singapore, Hong Kong, China, Malaysia and Russia (ahem Ukraine) and others accounting for nearly three quarters of all London new-builds, should explain it, and also explain why if the Chinese property and credit bubble indeed are popping, then London should be very scared.
»
- 19293 reads
- Printer-friendly version
- Send to friend
- advertisements -
Good schools and sharia law.....who wouldn't want to buy a house there.
Birds of the same feather, flock together.
No tax! No questions asked on origin of money!
In the UK is normal practice to verify the bank account where the money comes from, thus putting the onus on the bank to check the source.
I have recently also been asked these questions by the estate agent.
Note the above figures etc. are for property over GBP 1million, not across the whole market.
As i have previously said on ZH, London is an attractive place to park money in property with low annual charges compared to e.g. New York, Paris and no restrictions on who can buy unlike e.g. Switzerland. People do not go to live in / park their money in major cities for the weather but London is similar to Paris and does not have the extremes of New York.
Yes, prices are still overvalued, but more people are coming and they have not been building enough houses for years.
Smart money says it's the weather and the food
Stamp duty's not a tax?
not sharia law so much as sharia soaked money with a smell of oil.
wouldn't it just have been easier to show a chart of the growth of the Fed's balance sheet to explain why this is so?
Inflation is starting to affect the 1%. It might be time to do something about it.
The new tower of Babel in the city of Babylon behind the gate of Ishtar; where they plan to build 230 more high rise up market appartment buildings.
London City; New Babylon of the Oligarchs.
(The sheeple can just f*** off; no place for poor old men like Steptoe and sons).
Man, I once walked through that gate of Ishtar (it is in Berlin), and I can tell you from my own experience, that there is nothing, absolutely nothing comparable at all in London.
perhaps the Elgin Marbles. recently, an article on the FT pointed out that banker's bonuses in the City of London are directly correlated and a function of bonuses in NY's Wall Street
yet the main reason for London's prices is that London welcomes everyone... particularly if of the billionaire persuasion
OT, note that the City of London's spokemen recently declared his lobby to be for staying in the EU
the Elgin marbles!
(Oups Ghordius beat me to it!)
perhaps all that French wine slows you down?
drowning my post election sorrows as Marine Le Pen sings : the national front penis is mightier than the sword of Justice.
Our dear olde "socialist" president has now a budget deficit of 4.5% GDP and a national debt of 93%...(he promised to never exceed 3.5% in 2013 and bring it below Maastricht 3.0% in 2014...good luck with that!).
I wonder when the markets will start tickling the french bond lending rates up n up!
French bonds? forget it. even after all this repatriation, the French sovereign are behind the Spaniard, Italian, etc. it's a matter of French bank exposure "architecture"
in fact, many of my friends consider French bonds and stocks a screaming buy. and they were 100% right during the whole Greek drama
meanwhile, Le Pen, imho, is just getting the votes Sarkozy's bunch would be now getting if they would get their act together. just the usual "sacrebleu, we choose again the wrong prez" blues
even Marine's anti-EUR stance did not really contribute to her municipal landslide. really, people read sometimes too much into local elections
Spot on, Le Pen municipal vote is just protest vote.
But in MAy during Euro parliament elections it will have a more important effect on how the EU functions and/or to show up if the EU parliament is relevent in deciding Euro policy.
Poor old Sarko; he is now being treated like the Comte of Morcef in that masterpiece "The Count of Monte-Cristo"; as he is suspected of having betrayed the Bey of Tripoli who financed his 2007 election campaign.
And of course Putin now plays the Count of Gazprom-Monte Cristo, wagging his finger at the West for having "busted" the Bey of Tripoli; strong medicine that He will not accept be applied to ally Assad or to home turf of Crimea.
That Q-daffy caper of Obammy/Cameron/Sarko has had awesome geopolitical consequences. It has retriggered the new cold war and put the Greenback hegemony on a course of open world confrontation.
Some Cincinnati Kid type global poker plays have awesome blowback.
Okay, just for fun: The Elgin marbles aren't from Babylon, but from Greece. They were part of the Acropolis. We have also a part of it in Berlin, and right in the same museum: http://en.wikipedia.org/wiki/Pergamon_Altar
(As I said just kidding. And it is a habit for most physicists to tear holes in other's theories.) ;-)
Simply amazing that the tame and compliant UK media do not focus more on the lax standards vis a vis money laundering, when it comes to this "hot money."
Probably just following the US, as usual, where the NAR obtained from Congress an exemption from money-laundering charges on property sales. The US invented this stuff...
The Uk media is full of property Adverts and suplements. It is starting to become a political issue for priced out natives.
It's the new build where the scams usually are. Why are the promotors heading all the way to the Far East to sell their off-plan developments? Because a) the Asians are generally naive investors, and b) if you keep chanting the mantra 'you can't lose on UK/London properdeeee' many will come to believe it as 100% fact, just like the sun always rising in the East.
If the average Asian investor had any sense and bothered to do their own research, rather than relying on the nice promotors for their analysis, they would have worked out that in most cases new developments are the one's you want to avoid from an investment point of view. The far better properties are the older houses/or flats in older quality developments in good nick. When it comes to selling, those a) get a premium over the cheaply built new builds, and b) are quick to sell.
But oh no, like many Asians they only like things sparkley and new. You reap what you sow guys....
Ooo. I like shiney things.
Those of us old enough to remember the Japanese property grab during the 80's are getting a strange sense of deja vu all over again...
Great food, great weather, girls with great teeth, great value, what's not to love?
You're right. I just LOVE American women with fake everything, which is why they have to re-marry every 5 years. At most. I especially love their genuine attitude, and the way they all speak like they have a peg on the nose. Sounds like a fog siren to those of us from the civiliSed world??
Teeth can be fixed....
BTW, my wife of 30 years is Asian.
u mad, bro?
I don't "Flash on Park Ave." if that's what you mean..? Perhaps you meant 7th Ave/?
Lighten up, Francis. I wouldn't flash on Seventh Ave - too many PoPo, and it's a bit too breezy when the sun goes down!
hot foreign money is by and large cash money. no problemo. any bad mortgages held by the big banks that sour will be bought by the BoE for top-poundage bitchez. everyone else can suck it. is it bonus time again already?
Ice age gonna get them.
My aunts sisters cousins uncles son has got a four birth tent pitched up in regents park which is for sale...
He only wants £1.2 millions for it.
"four birth" funny. fore birth? after birth?
sounds moar like monetary foreplay, in regents park !
four berth and plenty of mirth.
Tell them to clear off, they're spoilng my view.
But, but there's no bubble!
WTF We never had the crash in property prices in the UK like the US.
We are firmly in a fuck off bubble of which London is screamingly obvious.
UK HOUSE PRICES 50% OVERVALUED MINIMUM.
And without high house prices the UK economy is fucked.
Get your popcorn.
Here's a prediction. Now if you go to some middle class dinner part in the UK it will take about 3 seconds for the conversation to head to property prices.
At sometime in the future, probably within 10 years, when the UK property market is a financial wasteland, mentioning 'uk property prices' at a dinner party will literally force some of the guests to throw up...
Was that "Dinner Fart" or "Dinner Party"??
The Daytime TV Programs are always a good indicator. Before the last UK property bubble burst, almost every daytime UK TV show was "Buy property at auction and make a fortune", "Buy property and spend a few pounds fixing it up to make a fortune", "Buy property to rent", "Buy property and re-sell at an enormous profit" etc. etc.
If those are back again...watch out.
Incidentally, I note that it's back again in the US at the end of property bubble 2.0, produced by the Hedge Funds. "Flipping Vegas" etc. etc.
Does nobody EVER learn. Has sanity been banished forever??
Those programmes never stopped. The level of stupidity in the UK about house prices is insane. It seems like no one thinks it's strange that we never felt the crash of '08 in house prices, there was a sight cooling for about 6 months or so, then, off to the races again. We are now above the original '07 high.
Look out anyone who's very low fixed rate or tracker rate finishes soon. Good luck remortgaging. Good luck to all those self certs that need to have more equity to be able to get an affordable rate, otherwise welcome to the standard variable rate or sell whilst everyone else is.
British people will be eating their own shoes in 10 years time.
I think a lot of the British middle class are begining to suffer cognitive dissonance when thinking about house prices. They love that they can brag about how smart they are buying property, but also ashamed that their 25 year old kid can't afford to move out because house prices are 15x grad starting salaries and they're already weighed down with GBP40k in student debt.
the Cameron cabinet had this idea regarding new, young buyers getting 20% of their downpayment from the government, and bringing down their "skin in the game" to 5%
I believe it lasted full three months, particularly because they realized who was getting into this scheme
meanwhile, ze Germans, generally speaking live in rent. according to Anglo-American social views, they should be rioting all day since evah
If you're referring to the Help To Buy scheme, it is still running although the eligilibility may have been modified to ensure it only goes to First Time buyers.
thanks, I lost sight on that scheme. so there were some "irregularities" which were "smoothed out"
Help to Borrow is still going, and has absolutely NOTHING to do with the election set for 2015.
The scheme is insane, lending people that don't have the financial discipline to save for a conventional deposit even MORE money, on property worth up to GBP600,000 (~US$1m), WITH the hindsight of what a real estate bubble did to the global economy in 2007.
Since the launch of the scheme, property prices have risen 7% (ONS), on top of what the OECD said was 31% over valued in early 2013: Focus on house prices Brilliant work.
What's more, it increases demand by making borrowing easier for at least some buyers, while doing nothing about supply, which is constrained by planning restrictions, green belts, etc. Guess what that does to prices.
That's a true analysis of Brits and the property market. Some parents of course will suck capital out of their homes and use it to buy or as a deposit to help the kids get started.
The other issue that most people do not understand and would ignore anyway is that when property prices rise, it is only the "paper value" that rises. But on the back of this funny money, they upgrade, take on a bigger mortgage and buy new imported stuff to fill their bigger home.
Yet nothing has been produced. There is no genuine increase in wealth.
If creating wealth was simply a matter of uprating paper property values each year, we should all do it and retire.
Sadly it is not. Hence we get the booms and busts.
The absolute level of interest paid increases though, which keeps bankers in bonus and the wage slave tied to his desk, too exhausted to think about the shitty life he's leading.
Exactly so!
Nothing to worry about we can have Low Interest Rates and Help to Buy forever, simples!
Pitchforks Come Out as Chinese Bust Kleptocrats
http://winteractionables.com/?p=10461
UK mortgage approvals dip "down to heavy rain"
How come people never buy when the market has crashed already, except for the big boys of course. We are having. REIT mania here in Ireland. Legislation only passed a few years ago. Three new REITS set up in two years and more to come. Buying up the best property for a song from the state bad bank NAMA. Within 5 yeARS, WE WILL HAVE THE CORRUPTION EXPOSED, THE SWEETHEART DEALS ETC
Rust, as well as the short fingered vulgarians, never sleep.
The new Europe = Eurabia
It's been suggested this
http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/1...
is
akin to the U.S.' loss sharing,
where tax payers, most unfairly
those who SOLD the mortgage bubble,
kick in paying for changes in
loan terms.
The former's upfront, the latter
the more sparing version of what's
needed to feed bank asset values,
that being simply covering those
who weren't qualified and then
in fact fell behind.
The latter removes the banks' skin
in the game, of course.
The former's something resonant with
ObamaCare's prescribed medical loss
ratios (profit margins) and immunity
from anti-trust, as feeding bank asset
values and paying in for the difference
needed as to ability to pay so as to
provide a privatized profit margin
both insulate the purveyor's margins.
In the case of the banks, there
of course should be skin in the game.
As to the insurers, there should be
that, so long as there's a pretense
of insurance, and what should be
insulated instead is the market's
service to patients and providers.
This (Purported At The
Source Link)
http://www.opednews.com/articles/Government-Backing-for-Tox-by-Mike-Whit...
Is Actually A Departure
From Privatizing The Absence
Of Risk. It's Please Create
Predicitably Bad Risk To Sell
Off For Yourself Though
Everyone Else Will Pay For It.
There was this:
http://www.businessinsider.com/henry-blodget-its-official-fannie-and-fre...
There should be public education, enabling,
and fair markets and family support, but
simply privatized policy/profits and
absence of risk is different.
Of course, manipulating supply raises
collateral prices and reduces supply,
and hence the new adults living longer
with Mom/Dad, more homelessness, higher
rents.
It contributes to this:
http://www.zuccottiparkpress.com/lauradreamforecl/
and this:
http://www.tomdispatch.com/blog/175777/
Propping insurer margins and use of
devices like PA's (not physicians assistants
but prior authorizations) in a manner centric
to those carriers and not doctors/patients,
and pre-texting Simpson Bowles-like cost
caps also increases the divide between need
and demand.
You may have a point, sir -- but damned if I can parse enough of the above to figure out what it might be.