The London population is expected to rise from 8.5 million people today to an incredible 10 million people by 2036. These are figures from the Mayor of London’s office and therefore figures which we can treat with some confidence going forward. It seems that a mixture of overseas investment, enhanced employment opportunities and the magnetic attractions of London will come into play in the years ahead.
There is some debate about the 10 million population figure although there is no argument about the fact that the population of London will grow at a much faster rate than anywhere else in the UK.
When you look at London it is certainly the hub of the UK economy and as such will attract the lion’s share of employment opportunities across the UK. While there are some factors to take into consideration, such as the pressure on the financial sector and a possible EU in/out referendum, we have been here on numerous occasions and the reality is the financial sector has gone from strength to strength. So if we look at the employment market in isolation there is every reason to believe that population growth will be above and beyond the average for the UK.
Pressure on housing
There is already significant pressure on London housing markets and this will almost certainly worsen in the years to come. Politicians have tried numerous strategies to reduce the pressure on property prices but so far to no avail. This will obviously play into the hands of real estate investors looking for long-term steady capital growth together with rental income.
In the run-up to the general election all political parties promised a significant increase in new house build numbers but until we see this in bricks and mortar perhaps we should take this with a pinch of salt. There have been numerous similar promises made in years gone by which have yet to materialise and in many ways politicians today are just regurgitating previous strategies which were never fulfilled. However, this does play into the hands of real estate investors looking at long-term markets where pressure will continue to build on housing.
Those living outside of London will find it hard to appreciate the average price of a London property is now approaching £500,000. This in itself is around double the cost of an average property across the UK and with some people forecasting an increase in London property to £1 million by 2030 the mind does boggle. However, this will most certainly play into the hands of long-term real estate investors looking to play the London property market which itself has become something of a safe haven for not only domestic investors but those from overseas.