The London property market has seen a huge increase in global capital flight- as it is seen by many as a safe haven during the eurozone credit crunch.
On the high end of this scale of capital investment is the commercial property market.
Since 2008, London has been the most traded real estate market in the world with 60% of the total investment from foreign investors.
The system in London is very investor friendly with transparent legal structures and it has fiscal benefits in terms of tax and capital gains which give it a certain advantage.
International corporations use London as a base for Europe, Africa and the Middle East- and London also responds quickly to global market pressures.
In late 2008, there was a 40% drop in values post the Lehman Brothers crash and as Sterling weakened. Bizarrely, perhaps, this huge markdown did little to dampen investor sentiment. In contrast to the fortunes of the US and other real estate markets, it led to a substantial increase in overseas interest.
As such, London stole the crown from New York in 2008 as the most traded real estate market in the world.
During the 2008-2011 period, some 42% of sales were from UK owners to foreign investors, with just 6% being traded the other way.
These foreign investors are discerning and are focusing on prime assets.
UK buyers are still the biggest group, holding 48% of all property here, followed by German investors which own 16%, US investors which own 10% and Middle Eastern investors which own 6%.
Japanese investment has fallen two percentage points from a high of 11% in 1995, while and European investment excluding Germany has fallen to 5% from a high of 8% in 1995.
There has also been a growing trend towards the super-rich, often labelled high net worth individuals, buying property.
The super-rich are also buying in the City. Officially they own some 6% of the office space there, but many think that could be an underestimate as it is difficult to trace ownership and there is a culture of secrecy.
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