UBS's recent press shocker, that they suspected, according to their analytics, that London house prices are in a bubble that is 95% likely to burst within the next three years, and bring prices down 30%, can surely do nothing to help those trying to achieve high prices in the short term. Although we live in extraordinary times and that leads to extraordinary predictions. Never before have we seen London house prices almost double in just over a decade, nor have we experienced the world population double to 7 billion people within a lifetime. The United Nations have recently warned that population could more than double again before the end of the century to a whopping 15 billion people. All this whilst the biggest migration this world has ever seen is currently taking place in China. So many Chinese are moving into cities, that by 2030 experts predict about 1 in 8 of the world's population will live in one. It seems that more and more of us are becoming city dwellers than ever before, and those who do own property in them are becoming more and more reticent to sell at anything less than a substantial markup on what they paid. When turnover drops it's always a sign that the gap between buyers' and sellers' expectations is widening, but then most sellers are also buyers elsewhere.
Selling or buying property almost always comes down to a change in circumstance, financial or personal. The fact is, despite their positions both sellers and buyers do hold one thing in common, a desire to do a deal at a level they're both happy with. Short term, will property prices drop by 30%? Unlikely. But it's likely to continue on a more level playing field, and it are these slower conditions that make for the safest trades. Looking forward ten years, where will prices be? If you find yourself on the fence wondering, consider all those people moving into Chinese cities and the seven billionth person that was born last month. Buckle up, London is only going to get more desirable.
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