London's Residential Buyer Activity Remains Strong in Mid-Summer, Despite Global Financial Unrest

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Despite global economic uncertainty and recent civil unrest, buyers of London real estate are still very active in mid-2011.

According to Ed Mead, director of London-based Gordon and Douglas, "Despite stock levels down by 40% from last year buyer numbers have fallen by only 20%. This has led to a very busy summer with buyers looking outside their original search areas and higher than expected levels of business reinforcing London's safe haven status.

"With the Fed announcing a two year freeze on interest rates, and supply at what's usually December levels, it's looking like demand will continue to outstrip supply leading to higher prices during the Autumn."

It's a different story for London's rental sector; residential tenants are opting to stay put.

Gordon and Douglas' Virginia Skilbeck said, "We have seen 68% fewer tenancies ending in July compared with this time last year, further highlighting that tenants are choosing to stay where they are for the time being.

"Although there are 40% less properties available to buy, we have seen 20% more rental properties coming to the market, perhaps as a consequence of rising rental prices making buy-to-let properties more attractive to investors.

"There are signs that the dramatic increases in rental prices seen in the last two years will start to slow as supply starts to exceed demand.

"For the first time, we have seen more people choosing to rent rather than buying, showing that like many European countries, renting long term is becoming much more acceptable and popular in London."

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