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Along with the rest of England, the London property market has been hard hit by the global economic turn-down. Adding to the problem of a tumbling stock market, changes in non-domicile tax laws led to a decline in prime residential property. The new annual levy of £30,000 has driven many wealthy foreigners working in London out of the city. The years 2007 and 2008 saw a sustained downward trend in sales for residential and commercial properties in London.
Londonís commercial property market has been especially weakened. A number of high profile building projects were canceled due to lack of funds. A major tenant withdrew from a planned office tower in Londonís financial district. A $433 million waterfront project was pulled earlier this year.
Central Londonís commercial real estate plummeted by seventy-six percent over the same first quarter 2008. The abundance of affordable property, however, has made Central London attractive to foreign investors. This has led to cautious optimism among buyers. Capital investment in London West End increased one hundred and ten percent during the second quarter of this year when compared to the first quarter.
There are signs that the worse is over. After a two-year downward spiral, peak prices are being paid for prime property. Eager buyers with available funds are seeing buying opportunities in Londonís real estate market. The conviction that the economy is about to turn is sparking renewed interest in London property.
Central London appears to be leading the anticipated recovery. Residential property prices continue to rise, and sales are up by ninety percent compared to early 2008. The lower end housing market rose more than 5 percent earlier this year, while the £10 million and up market rose by 2.4 percent. Multiple bids on the same property have driven residential property prices up to peak level.
Sales of central Londonís commercial property have seen an upward turn, mainly due to continued strong overseas investments. This interest is seen as a prediction for a turnaround in the commercial property market.
London has much to offer. As a major tourist attraction and business center, it is anticipated that London real estate will soon be at the forefront of Englandís financial recovery.