Black Brick has recently announced that it has completed on a dozen separate transactions for investment clients over the last few weeks – all with budgets below £2m including clients from Brazil, Egypt, and Qatar with budgets from £2m to £4m.
Camilla Dell, Managing Partner of Black Brick, comments: “We continue to see interest from a range of buyers, including both investors and owner occupiers; other developments of note include a significant rise in Russian interest across both the rental and sales markets in recent weeks. The return of the Russians comes despite the collapse of the rouble against the pound. And while the sharp drop in the price of oil clearly has its own implications for net wealth in the Middle East, West Africa and Russia, the strength of the dollar does at least offer some compensation for potential buyers of PCL property with US dollar assets. Sterling's 9% drop against the so-called 'greenback' and a fall of similar magnitude against the Chinese yuan since mid-year is giving buyers in these increasingly significant asset pools a welcome currency discount. We expect Chinese buyers in particular to dominate the high end of PCL property in 2015.
We also expect political concerns to continue to be a driver of overseas demand for PCL property in 2015 and beyond.
However, for the domestic market, 2015 is likely to be a year of two very clearly defined halves split by the general election. Should the Conservative party win the May 2015 election, we expect an extremely active London property market and the opportunity to drive a hard bargain with vendors will be significantly reduced if not lost all together. We believe the period between now and the general election may prove an attractive entry point to PCL property over the long-term.
Meanwhile, given the extent to which Labour's proposed Mansion Tax has already been watered down, we do not expect a Labour victory to have a dramatic impact on London house prices – though some short-term weakness in prices is likely. We expect the market to pick-up again once the extent of any annual charge above £3m is clarified. Our experience with previous tax changes affecting PCL property is that it is the uncertainty that buyers don't like rather than the imposition of the charge itself. In the recent cases of higher Stamp Duty above £2m, and the implementation of Capital Gains Tax for foreign owners of UK property, the market paused while waiting for the precise details before regaining momentum.”
What's hot for 2015: where potential owner-occupiers and investors should be looking
Camilla adds: “For owner-occupiers, Marylebone offers the best of all worlds. Characterised by high quality independent retailers and restaurants, including the A-list favourite Chiltern Firehouse, Marylebone has one of the best high streets in London. Marylebone is conveniently located with the many attractions of Oxford Street just a short walk away, as is the relative peace and quiet of Regents Park. The elegant period housing stock has recently been bolstered by new developments such as The Mansion, W1, The Chilterns and Chiltern Place and we believe that Marylebone will continue to be one of the most sought after locations in London – and not just for those who cannot afford to buy in Mayfair.
For investors, we are tipping Maida Vale as one of the best areas in London to focus on in 2015. Overlooked by buyers in favour of neighbouring St John's Wood, Maida Vale looks extremely good value compared to its more expensive neighbours. Prices are still well below £1,500 per sq. ft. – rare indeed for an area with such excellent shops and transport links to central London. For example, we are currently in the process of acquiring a 1,040 sq. ft. three-bedroom, three-bathroom apartment for £1.25 million on behalf of a client, which equates to £1,200 per sq. ft.
For new builds, or off plan buyers, there are due to be well over a dozen new developments in the pipeline across PCL over the course of 2015 and beyond, giving buyers the luxury of being able to pick and choose. As ever, it will be hugely important for buyers to carefully analyse the pros and cons of each, along with pricing, location and volume of units being developed in order to determine which ones will be best suited for investment.”
