Jason Richardson, associate at Bircham Dyson Bell LLP, who works in the lease extension and enfranchisement work team, believes that the current unrest in the Middle East, and economic instability across Europe is helping to increase the attractiveness of investment in prime central London residential property ("PCL").
"The fear factor of investing in countries with political or economic unrest is driving wealthy foreign investors to purchase in PCL. This has a knock on impact on lease extensions and collective enfranchisements as the cost of extending leases or enfranchising the freehold also rises. In a rising market owners are always eager to serve an initial notice as soon as possible in order to fix their valuation date. We have not seen any let up in the service of initial notices," explains Jason Richardson.
"PCL is in a bubble of its own, as the prices are rising year on year and they do not follow the traditional cycle that was influenced by city bonuses."
"It doesn't appear that the bubble is about to burst either, as these are cash buyers who do not have the problem of raising debt finance. PCL is still seen as a stable market place but in a rising market any wise investor must always be looking for the triggers for correction - as yet none have appeared."
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