Property boom

Mideast makes up 10% of London foreign house buyers...

One in ten foreign buyers of second hand properties in central London are from the Middle East, a leading UK agent has revealed.

The majority of Middle East buyers in London were parents buying properties for their children while they were attending London universities or they were family purchases for their own use, according to Liam Bailey, head of residential research at the Knight Frank real estate agency.

Properties bought as pads for Arab students of London colleges were priced in the £500,000 to £1.5m ($735,220 to $2.2m) range, properties to be used as family homes usually had price tags of £3-5m ($4.4-7.3m) and wealthier Middle East investors were stumping up in excess of £10m ($14.6m).

The recent Rightmove House Price Index in May showed that property prices in Greater London rose 5.7 percent year-on-year and the average price was now £420,203 ($617,371).

Middle East buyers generally tended to target properties in central London, around Bayswater, Marylebone, Notting Hill and Chelsea.

The Rightmove report found that prices in the City of Westminster average around £1,171,675 ($1,721,423) and have risen three percent in the last year, while in the affluent Kensington and Chelsea borough prices rose one percent to an average of £1,887,753 ($2,773,485).

Bailey said the majority of Middle East buyers in London were from the UAE, Qatar and Saudi Arabia.

While the London second hand homes market has proved popular with Arab buyers, the investment sector has not drawn the same interest and Middle East buyers only account for three to five percent of purchases.

Middle East interest in London property assets has risen in recent years, with Qatar leading the charge.

The small emirate recently bought the upmarket Harrods department store in Knightsbridge and is also involved in the redevelopment of the Chelsea Barracks development, the construction of the Shard of Glass project, which when complete will be the tallest building in western Europe and last year invested in Songbird Estates, the owners of Canary Wharf.

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