Foreigners Snap Up $2bn in London Property in Christmas Week

Foreign investment in the London property market has been growing for 18 months, but never so fast as in the week before Christmas. In one week alone buyers from Asia, Africa and Europe bought £1.3 billion worth of skyscrapers, upmarket clothes shops and sprawling City office developments.

The surge of demand shows that London still retains its safe haven status even as the EU crisis worsens and there was talk of British isolation.

“Buyers are aware that now is a good time to come into the London market as many sellers are distressed or concerned about the impact of the eurozone crisis on future valuations,” said James Beckham, director of capital markets at Jones Lang LaSalle, the property services group.

The purchase of Tower 42 Nathan Kirsh, the South African property tycoon, from BlackRock and Hermes Real Estate, was the biggest and most noteworthy sale of the week. The tallest occupied skyscraper in the City and former headquarters of NatWest bank went for £282.5m.

The Malaysian government's investment arm Permodalan Nasional Bhd also made the noteworthy shortlist with its £350m office complex purchase. In its UK debut PNB snapped up the 460,000 square foot Silk Street Building just down the road from Tower 42.

It is not just prime office stock that has attracted overseas interest, however. A property investment vehicle backed by Ernesto Bertarelli, the Swiss-Italian pharmaceuticals billionaire, on Wednesday announced its first investment, acquiring a 186,000 sq ft mixed-used building in Mayfair in a deal rumoured to be worth more than £100m.

Confidence Returning in UK Property

According to the latest Zoopla.co.uk Housing Market Sentiment Survey, there is a returning of confidence to the property market as about two-thirds of homeowners stated that they anticipate property prices to increase over the next six months. Last year about 50 percent believed that the property prices would increase.

In comparison with a third of people in December who thought that prices would fall, only a quarter expect prices to fall now. More optimism abounds now concerning the amount that prices will increase. Out of 7,984 people surveyed, people predicted that prices in their area will increase by 2.8 percent within the next six months, which is a 1.9 increase from three months ago.

Northern Ireland saw the greatest improvement, in which 57 percent of homeowners anticipated property prices to increase. This is a 42 percent increase from three months ago. Scotland also saw respondents anticipate high gains at 63 percent.

With the last nine months experiencing steady declining prices, Nicolas Leeming from Zoopla.co.uk states that this may be a good sign that the property market is on the upward swing.

There is a low inventory of homes currently and homeowners are continuing to anticipate prices to increase in their areas. The confidence levels are not the same as they were in early 2010, but the improvement is being received well and increasing optimism.

Many real estate experts anticipate about a 2 percent decrease in property prices in 2011 as a whole and many are quite optimistic that the property market will have a favorable year.

Turkey is the BRIC of Europe Says UK PM David Cameron

In a message sent to an important U.K.-Turkish business event organized by the Turkish-British Chamber of Commerce and Industry (TBCCI), UK Prime Minister David Cameron has reiterated the party's sentiment that Turkey is the BRIC of Europe, in reference to the so-called BRIC economies of Brazil, Russia, India and China, grouped together as the world's fastest growing emerging markets.

Turkey is the "BRIC of Europe," he said. "Everyone is talking about BRIC countries and the rapid growth in [the group’s] economies of Brazil, Russia, India, and China. We think that Turkey is a BRIC country of Europe," Cameron said.

This is at least the second time that Cameron has voiced such sentiment in relation to the Turkish economy.

One would find it hard to mount a reasonable argument against him, in fact the figures make Turkey exactly that.

According to Turkstat the Turkish economy grew 11.7% year on year in the first quarter of this year and 10.3% in the second quarter. This is compared to growth of 0.7% and 2% respectively for the EU bloc, and 4.6% and 5% respectively for Slovakia, the fastest growing economy in the EU according to Eurostat data.

The BRICs were put together in that anagram by Goldman Sachs because they were and were likely to be the fastest growing emerging economies in the world. Turkey is without doubt the fastest growing economy in Europe, which means it can be called the BRIC of Europe without too much fear. Wonder if Cameron is pulling any strings to get it into the EU?

Nah, on a serious note, Cameron said that trade between the UK and Turkey could be doubled if both sides work hard on it in the coming years.