Luxury home sales in London and healthy savings
Housing market improvements could indicate upward trend for Londonâ€™s economy.
13:09 07 May 2013
Increased sales of luxury homes in London may indicate some recovery. The housing market is benefitting from higher demand and lower availability which is driving the prices up, while in other areas prices for luxury homes are falling.
What this could also indicate is an increase in savings activity, or potentially the retention of savings, even in the face of the weakened economy.
What does this mean for the economy?
There are obviously many possibilities, but here are just a few things that this information could portend.
- More individuals in London have enough wealth stored in savings to purchase luxury properties than in some other places.
- The average cost of a flat in the London area also suggests there are plenty of people who desire, and are capable of purchasing one, even though pricing has broken the £1million price marker.
- Greater numbers of families with enough money to purchase these types of properties have managed their money well, and would be helping the local economy by their shopping and savings habits.
- Increased shopping and banking activity could signal a much faster economic recovery in London than in other areas.
- Additional attention and recovery in the London area could also draw investors looking for opportunities, and could help reduce unemployment rates as well.
- There may be an increase in the number of businesses created if those who have been careful with their savings during the economic depression start businesses that will fill a need and also promote greater economic recovery.
- At the very least this could indicate successful savings ventures and investments, and increasing amounts of purchases could indicate improved ability to establish significant savings.
Housing markets are typically a good indicator of the financial health of a local economy. The 8per cent jump in prices indicates the demand for luxury housing, and is expected to increase once the news is out regarding this status.