Latest BNP Paribas report predicts London property growth
July 03 2012
The latest Housing and Economy report from BNP Paribas shows encouraging signs for the future of London property. The report predicts that growth between 2007 and 2016 will reach 52% as London continues to outperform the rest of the UK.
The report was compiled by Professor Patrick Minford, a former economics advisor to Margaret Thatcher. The report states that last year the growth in London was 2.71% but that the figure is expected to rise to 5% in 2012 and more than double in 2013 to 11%.
These figures equate to an 8% rise in the next five years and means that from 2007 to 2016 the expected growth of residential property will reach 52%.
London is a frontrunner in UK residential property and over the past five years the capital has led the way but only with an annualised figure of 0.7%. Over the next five the report predicts that London again will dominate the market and growth will be much grander.
New homes are believed to be the main factor behind London’s continued growth. In the new homes sector the number of units has increased but number of schemes had fallen. This can be attributed to large developers funding more schemes while the smaller developers struggle to accumulate finance. It also points to an increase in volume housebuilders.
Tim Cann, head of residential at BNPPRE, said: ‘The housing market has drifted sideways for the last year but demand for housing, and houses in particular, whether to rent or buy has continued to rise despite recession. Signs of increase in mortgage provisions and the return of first time buyers (even from a very low base) will help demand. Furthermore, the on-going housing supply shortage will drive rental growth in core city locations, underpinning house prices and preventing decline and an increase in employment and recovery in the economic backdrop will help prices from 2013 onwards.’
To read the report from BNP Paribas click on the link below.
posted at 12:42 PM by Christian Thomas