London Property Investment and Below Market Value

London, the city capital of England and the United Kingdom, is among the foremost global cities, and together with New York City is the largest global financial center. Through the years, the London investment property sector has enjoyed a very high stature as among the most expensive and sought after in the world. But logically, the real estate industry in the city, and the whole of the country, has also been affected by the global financial crisis.
Inevitably, the global economic downturn has somehow rubbed out some of the shine from the city that has been a property investment favorite for the past decades. However, London is not yet dropping out of the league, according to global property investment analysts and observers. Of course, this could be attributed to the fact that the city still houses the world’s most important media firms, non-governmental organizations, creative industries, top restaurants, think tanks, design and marketing companies, world-class headquarters, medics, and leading law firms.
Apparently, period architecture, leafy streets, good universities, vibrant theaters, and gracious parks are also still working in the city’s favor. The same is the effect of London’s stabilizing middle class. Top-end property investment buyers and high-earning professionals are still keeping the flame of the investment properties in the area very much alive and luring.
During the peak of the financial crisis onset, London investment property sector has naturally suffered a downturn. Prices started to move down, significantly that every investment property club in the city was alarmed. Numerous discount property units were offered and residential and commercial estates fell below market value. Estimates have it that costs of investment properties in London fell by about 20% to 30%, simultaneous with an almost 20% depreciation of the sterling. Thus, international buyers feasted on every discount property available, which was almost half the original price.
It was also noted that London lured property investors from other parts of the world, specifically those from Asia, the Middle East, China, Africa, and Australia. It was logical that the usual real estate investors from Russia, North America, and other parts of Europe showed less interest in buying London investment property units.
During the past several months, the effect of financial downturn has been slowly dissipating. Market observers note that property price dips are starting to be steady. In April, 2009 prices eased up and rose albeit by a very modest 0.4%, but it is the first move up of London’s property market since March of 2008. Analysts are optimistic that price falls are coming closer to bottom in the central London property market. According to market experts, this is the best time to seize the opportunities of seeking and buying discount property investments before tag prices normalize and get very expensive again.

To most investors, it would always be wise and prudent to invest in a London investment property, regardless of market conditions and economic factors. This could be because demand is expected to remain high no matter what happens. The constantly growing population could be cited for this. As of 2007 estimate, London population grew a further 8% to about 7.56 million. It is just logical that people would always consider buying homes, renting apartments, or investing in many real estate endeavors.