Background

For decades the Royal Borough of Kensington and Chelsea has been revered as ‘the’ place to buy in Central London for owner occupiers, investors and developers alike, but why?

There are a number of reasons for this which I will try and clarify in this blog but the appeal of the area is not just to UK residents but the world over which is why it hosts such a diverse community.

The city of London (Londinium in Latin) was established by the Romans around AD 43. It served as a major imperial commercial centre and has not stopped growing since. It grew into a modern international trading City during the expansion of the British Empire which at its height, it was the largest empire in history and, for over a century, was the foremost global power. As a result, its political, linguistic and cultural legacy grew as did the financial, legal, insurance and other business markets we see so prominent today and all the subsidiaries that serve them.

So what, you may ask, has this got to do with the central London housing market, well…everything!


International Appeal

This diverse City with its art galleries, West End theatre productions, period & modern architecture and its numerous restaurants and shops is a very attractive place for people to visit or, for the slightly more affluent, to buy a Pied-a-Terre.

Over the last two years since I have been at Farrar and Co, approx 40% - 50% of our stock has been sold to international buyers which shows the strength and attraction of the central London residential market to the international community.

The other reason for the high European interest has been the destabilization of the euro zone which has lead to Europeans and other investors with money tied up in the euro zone looking to move money out and into a safer environment. This has tended to be either precious metals or prime property for which London has been the preferred choice.


Accessibility

The Royal Borough of K&C is very well located for quick commuting by either bike, tube, bus or car to the West End, the City or to Canary Wharf which makes the area very popular for professionals and families alike.


Amenities

As mentioned earlier in the blog there is a huge cultural attraction to Central London from museums to West End theatres and from art galleries to palaces most of which are located within or very close to the Royal Borough which makes it very accessible to be enjoyed by the public.

We have some of the most reputed and cutting edge restaurants in the world in Central London which adds to the global appeal and makes living here an absolute pleasure!

London also has some of the most historic and prominent shopping in the world, from the 60’s swinging Kings Road to the more traditional Harrods, Harvey Nichols, Partridges and Peter Jones.

There are numerous educational establishments in the area from nursery schools up right up to higher education which again makes the area very attractive to foreign families who are happy to relocate here for work knowing they have an excellent educational process for their children.

We also mustn’t forget that Central London is one of the greenest Cities in the world with Regents Park, Hyde Park, Holland Park, Green Park and Battersea Park all within very close proximity.


Architecture

One of the things I love about RBK&C is the architecture which was really driven forward mostly in the Victorian era with the lovely manicured garden squares, sweeping colonnaded streets and historic mews houses all of which are some of the most symmetrically beautiful and sought properties after in the world.


Investment

Now onto, for many people, the main point of buying in the borough - an almost unbeatable return on an investment compared to other asset classes.

Property prices in Central London and more specifically in RBK&C have probably been the best performing investment asset class over the last four or five decades which makes it a very attractive place for national and international investment.

Investors rely on two things to create profit, rental income and capital appreciation.

As a rule of thumb, property in the borough seems to roughly double in price every 10 years. However according the market research, since the beginning of 2006, the Lots Road area has shown a 30 - 35 per cent year on year increase which is slightly above the average.

The rental market in the borough is also extremely active due to the benefits the borough has to offer as specified above. This creates a very competitive and quick market which means investors have minimal rental voids and achieve high rental figures thereby increasing their annual percentage return. These yields, at the moment, should be around the 4% – 5% mark.

The borough also has some of the best specialised developers in the country operating within it which provides some of the most modern, contemporary and amazing conversations / new developments in Central London. One Hyde Park being the current pinnacle of opulence within the area.

There are a number of reasons why the borough is so popular but at the end of the day I think its mostly down to the old saying ‘location, location, location’. People are reluctant to live in London and have to commute more than an hour each way so there will always be that radius round central London which is going to be competitive to buy in due to its close proximity to work areas. The borough allows residents to access the West End, City and Canary Wharf within this hour timeframe and also be on the door step of the best London has to offer outside work.


Conclusion

I have tried to briefly summarise why the Royal Borough of Kensington and Chelsea has the appeal and attraction it does and I think its clear from the reasons above why this is the case.

It’s a great place for families, high net worth individuals, professionals, students, investors and developers alike which is why it’s probably the greatest borough in the whole of London.