A writer for The Times has suggested the London property market is on the verge of a boom, offering a ray of light in an otherwise gloomy outlook for the capital.
Oliver Shah, business editor of The Sunday Times, said people should not write off the capital too quickly because it has previously withstood challenging periods.
He pointed out that in 1987 Canary Wharf, the financial district, was a patch of barren land serviced by a road so narrow the developers had to revive the lighterage trade to bring materials in.
The project went bust in the early 1990s when the property market crashed and London Underground failed to extend the Jubilee line.
Its survival and eventual success were a testament to both the determination of its founder, the Canadian Paul Reichmann, and to London’s natural business magnetism.
“The latter has not disappeared overnight,” Shah wrote in his column. “London has proved itself capable of pushing through the stupidity of politicians in the past. However bleak the next few months seem, I suspect that anything other than Armageddon in March will bring a degree of relief in the City and Docklands.”
“Now, the darkest hour could turn out to be a very good time to invest in a penthouse — provided you can swallow the stamp duty.”
He said it is easy to blame the property slowdown on Brexit, but argued it was probably a case of joint enterprise between Farage and Osborne.
The former chancellor’s decision to raise the top rate of stamp duty to 12% in 2014 hammered the high-end market.
Meanwhile, Osborne’s buy-to-let raid came at precisely the wrong time for the capital’s economy.
“It meant that international ardour was already waning by the time the Brexit vote came along in 2016 and dented confidence further, made foreign labour scarcer and sent sterling tumbling, pushing up developers’ costs (although the devaluation also made property cheaper for overseas buyers),” Shah said.
Shah added that it would be a brave person who bet on a sudden Brexit breakthrough in October and a peaceful parting from the EU in March.
“London felt like a modern city state three years ago. That confidence has cracked. The bears predict a long-term erosion of its affluence and influence. And yet Canary Wharf’s history tells you not to write off the capital too quickly,” he concluded.
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