London’s booming!

By Richard Lamberth

At last! It seems that confidence is returning to Britain with London leading the way. Property prices are picking up – not just in the prime, central London areas – and the number of transactions is running at their highest level for five years across the south east and beyond.

The Halifax has released figures showing that house prices increased by 2.1% in the three months to July, a healthy 4.6% up on last year. Mark Carney, the new Governor of the Bank of England, made an early new intervention by giving assurances that interest rates will remain low for the next three years or so and will be largely dependent upon achieving real decline in the unemployment rate (Editor’s note: also see article on facing page). This has been widely welcomed as a massive confidence boost to first-time buyers in particular.

Manufacturing output in June jumped by 1.9% and though this may be way off levels achieved in the boom economies like China, it is certainly going in the right direction. Meanwhile, this was supported by an increase in retail spending of 2.2%, the fastest rate for seven years. Car sales alone are running at the highest levels for six years.

Growth generally within the UK economy is now forecast to hit 1.4% this year, according to the Bank of England, and next year they are predicting 2.5%. This all seems a country mile away from the doom and gloom predictions of the last few years, and there is little doubt that the decline has been made much worse by the accompanying sentiment of never-ending austerity.

As ever, the Capital produces some interesting sub-stories and one accompanying this new optimism is the flood of investors and entrepreneurs into London’s booming hotel and restaurant market. Billionaire Carphone Warehouse founder, Charles Dunstone, has just become a partner in the UK arm of US burger chain Five Guys, and David Beckham is reported to be joining forces with Gordon Ramsay to open a new restaurant called the Union Street Café at Borough Market on London’s Southbank.

So what does this new-found, upbeat talk mean for the Algarve? Well, it doesn’t take too much of an upsurge in confidence for people who are generally feeling better about everything to start looking for that wonderful holiday home in the sun – and where better to look than the Algarve, just 2.5 hours away and with 300 days of sunshine a year.This should be great news for property owners here at the tail end of 2013 and into 2014 as things really start to move.