The Problem With Flats
Jeremy McGivern
Founder of Mercury Homesearch | We help individuals and families acquire their ideal homes and investments in prime central London while avoiding all the wasted time, money and stress suffered by most buyers.
There was an article in the Financial Times recently called The Problem With Flats.
They rightly pointed out that they had underperformed houses over the last 5 years.
Which has been against the trend because they have outperformed houses (on the whole) for the last two decades.
The FT cited a couple of reasons for this:
1.?????The pandemic
2.?????The Grenfell Tower fire and subsequent issue with cladding in several buildings
Consequently, the article suggested that acquiring a flat is not a good idea. But is this really true?
领英推荐
In London, the reduction in the popularity of apartments was also due to the joys of Brexit and Corbyn. Most international buyers and the wealthy in general delayed discretionary purchases during this period of huge uncertainty.
And while lockdown is over and some international buyers are in London again, we are still well below normal levels. But this seems to be temporary as London has recently been voted as the number one city for the wealthy.
The rental market also shows what is really happening. Yes, houses are trading for a premium in both the sales and rental market, but there is also a shortage of flats to rent. And when international buyers return to London, they will mainly be focussed on apartments because outside space is less important to them – people do not come to London for the weather!
Likewise, millions of people have lived in flats for decades and been perfectly happy. The lockdown was an anomaly rather than the start of a – and please excuse the use of this dreadful term – “new norm”. The stunning weather we had was also an anomaly as the rain has proven! So, I expect the premium for outside space to reduce in the next couple of years.
As usual, it will pay to ignore the talking heads in the press and conventional wisdom.
Indeed, flats are looking very good value at the moment and will prove to be good investments. But whether you wish to acquire a house or flat, please follow our “Best in Breed” strategy to ensure you find the best property your money can buy and negotiate the lowest price possible.