New York sneaked in front of London to become the most popular location for overseas property investors, according to a report by broker Cushman & Wakefield this week. Predictably, the report accounted this change in fortunes to the recent Brexit vote saying it was “one of the most potentially significant factors currently in play” in the real estate market.
Although it appears all is not lost for London. Even after arguably the most volatile economic and social period London has experienced in decades, the stats show it only lags New York sales by a slither.
The real estate market in New York is slick, collegial and efficient. Manhattan based agency Douglas Elliman sell immaculate new developments with every conceivable mod-con to foreign investors. The most recent of which is 1 Seaport, an 80-unit development based in Manhattan’s financial district which boasts an incredible concierge, residents spa, huge fitness centre a communal children’s playroom.
Elliman have a strategic alliance with UK based Knight Frank, but the U.S estate agency differentiate themselves by working with developers during construction and planning, sharing their experience of what investors look for from a property to create the perfect pad.
New York real estate has a curious history. Republican Presidential candidate Donald Trump allegedly still holds 53% of his real estate wealth in New York City, including a myriad of skyscrapers. A-listers such as Robert De Niro also have a strong presence in the real estate market, the Godfather star owns several luxurious properties around the Tribeca area as well as being a co-owner of swanky restaurant chain Nobu.
It might not be plain sailing for either New York or London though. David Hutchings, Head of EMEA Investment Strategy at Cushman & Wakefield said “with the scale of change underway in the macro environment – from Brexit to Trump – many investors are now struggling to decide where they should look for value.”
DMZ thinks the ingenuity and maturity of the New York property market, plus overseas concern around Brexit could be troubling for London in the short-term. However, the current weak pound makes some areas of London real estate look considerably cheaper than 6 months ago, which could easily spur investors to pile back in to the Capital.
Add to this the perks that made London such a real estate mainstay – solid legal system, world class education system and a prime geographic trading location –you can see how the lure of London real estate runs deeper than a simple currency play.