London property tipped to remain popular with foreign investors
Property investors around the world appear set to continue looking towards London, despite Britain's slip back into recession.
The UK is now in the grip of its first double-dip recession in more than 30 years, following last week's news that economic output dropped by 0.2 per cent between January and March 2012.
But Liam Bailey of Knight Frank believes this is unlikely to put real estate investors from overseas off transferring money into established markets such as London.
This, he stated, is because the fundamentals that first drew people from other countries to this location are unchanged, despite the negative economic figures.
"Demand from foreign buyers has been strong for the last two or three years," Mr Bailey observed.
"Even though the pound has recovered some ground against the euro, that has still not stopped foreign buyers from coming into the market."
Mr Bailey argued that demand from real estate investors based outside the UK is "holding up pretty well" and looks likely to keep doing so for the foreseeable future.
He said this is partly because they are confident in Britain's long-term investment potential, which means short-term shifts in gross domestic product (GDP) will not heavily influence their perception of the market.
Mr Bailey added that although the economy is back in recession, the latest set of GDP figures are not substantially different to those that have been seen over the last few years.
"It is just more of the same really on the GDP side," he stated.
This echoes recent comments from MyLondonHome, which said rising unemployment and limited mortgage lending in the UK will also fail to deter foreign buyers from investing in the capital. Indeed, managing director of the organisation Steven Herd said it is "optimistic" about the outlook for this year and expects the value of property in London to go up.