| Central London residential property prices | | | | property immediately after returning home. |
| rose by 3.9% in July 2007, the highest jump | | | | However, because of substantial rises, such |
| in a single month for 31 years, according to | | | | as the 36% recorded over the last year, |
| the Knight Frank Prime Central Location | | | | property is increasingly being retained as an |
| index. Lack of supply of suitable properties | | | | investment once the buyer returns home. This |
| is considered the reason for the continued | | | | has helped fuel the property shortage and in |
| rise in residential prices throughout central | | | | turn keeps central London property values |
| London, with rises in house prices | | | | high. |
| consistently outperforming gains in flat | | | | |
| prices month on month since January. | | | | In 2004 the average period that a foreign |
| | | | buyer would hold onto their property after |
| July's figures give an annualised growth of | | | | returning home before selling it, was nine |
| 36.4% - the highest annual growth since 1979 | | | | months. Last year that period had risen to 20 |
| - and now the reasons for the lack of supply | | | | months and is still rising. It appears that |
| driving the outstanding price increases are | | | | rather than take a quick profit on their |
| coming under the microscope. It appears that | | | | London property foreign landlords are now |
| foreign buyers have a large part to play, as | | | | willing to reap an income from tenants while |
| 61% of all property over £4 million for | | | | watching the capital value of their property |
| sale in prime central London is sold to | | | | investment surge. |
| foreign buyers who, unlike domestic buyers | | | | |
| tend not to have another property to release | | | | Of course, foreign buyers cannot take all the |
| back into the market, thus restricting supply | | | | blame - or credit - depending upon your point |
| even further. | | | | of view, as for the substantial and sustained |
| | | | increases in property prices in central |
| The substantial rise in property prices has | | | | London multi-million City bonuses have been |
| also led to a shift in the behaviour of | | | | swiftly invested in prime central London |
| foreign buyers who initially buy their | | | | property, which is still seen as the most |
| property for occupation while working in the | | | | solid of investments. So, unless foreign |
| City. In the past many would arrive to | | | | buyers and city brokers decide to liquidate |
| undertake a prestige job in the City and | | | | their investments the outlook for central |
| purchase a property solely for occupation | | | | London property seems bright indeed. |
| while they were in the country and sell the | | | | |