London property prices 'set to rise' in 2012
9th Feb 2012
The reduced amount of central London property expected to be placed up for sale in 2012 could cause upward pressure on prices, according to one source.
Naomi Heaton, chief executive at London Central Portfolio, said that many investors who are already holding real estate in prime London central do not see a better place to "park their money".
This is because they are pursuing a strategy of wealth preservation with a potential upside and avoiding the more speculative equity markets, the expert stated.
It comes after a new report by Knight Frank showed that the price of prime central London residential property rose overall by 0.9 per cent in January, pushing the three-month rate of growth to 2.7 per cent, which is the highest rate since July 2011.
Annual growth now stands at 11.9 per cent, with prices rising 42 per cent since their post-Lehman low in March 2009.
Ms Heaton noted that it is not a given that people will put London property up for sale this year, however, as they look at rising prices and figure that bricks and mortar are a safer investment than other ventures.
"They will therefore hang on to their real estate holdings. Meanwhile, investors outside the magic circle will be seeking to get in, increasing demand and an upward pressure on prices," she predicted.
© Zoopla Property Group Limited