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Capital appreciation slowly returns for Prime Central London investors

Capital values in Prime Central London have increased according to the latest market snapshot from investment service London Central Portfolio.

House have risen in value by 7.9 per cent and 6.9 per cent for flats since the low point in the pandemic to June 2022. 

Houses continue to outperform flats, but there are signs the gap between the two is continuing to narrow, says LCP. 

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It says: “The return to the office, at least on a part time basis, acts as a strong catalyst for professionals seeking apartments close to their place of work. We are also beginning to witness the physical return of some overseas investors enjoying their first summer in London since 2019. This has resulted in continued price growth for flats despite the wave of interest rate rises over the past six months. 

“With buoyant PCL rental values and rising yields, there is a strong incentive to consider the continued suppressed pricing of flats as an attractive investment opportunity.”

However, London Central Portfolio’s latest data on transactions shows a continued drop in activity. 

PCL is yet to see the full return of high net worth international buyers in numbers witnessed before the pandemic. 

“This has meant the recovery in the PCL market has been much slower than expected with prices still seven per cent below their 2015 peak and lagging behind growth across wider London and the UK as a whole. This lack of investor appetite is leading prospective sellers to hold their property until the market improves.” 

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    Capital appreciation only covers inflation.

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    In my experience houses are worth fewer pints of beer than they have ever been, and that's before pouring 28% of these pints down the drain as CGT!

     
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    Yes Robert, inflation is a stealth tax

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