“People are coming out of the cupboard and wanting to play. The amount of people who want to do deals is very encouraging and leads me to believe that if we haven’t already passed the low point, we are nearby.”
The reason, he notes, is twofold: the falling value of the pound, which has increased the affordability of UK property to international buyers, and the attractiveness of London as a prime location. “The reasons for buying are as live as ever,” says Mr Abrahmsohn, already in negotiations with a Russian on a £28 million place. He has also fielded two enquiries about £40 million properties in north London.
“The Russian stock market is down around 70 per cent but interestingly, the ruble is pretty close to the pound. For people who deal in rubles, the pound is very attractive. If they deal in dollars, investors get a gain of 30 per cent on the currency and 30 per cent on values of some properties. So for a foreign buyer, there is almost a 60 per cent discount from last year.”
Price falls at the top end of the market have been slower. “They are down maybe 10 or 15 per cent, but people will still pay full price for very rare properties. There are other motives besides good value and price that drive the oligarchs and potentates to buy.”
And there is more good news for Mr Abrahmsohn, who claims to have the largest portfolio of new homes in north west London.
According to property valuation website mouseprice.com, homes in certain parts of north west London now dominate the wealthy property league. Streets between the Hampstead and Highgate golf courses have jumped from sixth to second place in the table, replacing more traditional hot spots in Kensington and Chelsea. The roads are: Ingram Avenue, Courtenay Avenue, Winnington Road, The Bishops Avenue and Spaniards Close. Ingram Avenue in Hampstead Garden Suburb is now the second most expensive street, with an average property value of £5,234,200. Courtenay Avenue, Highgate, where properties are worth an average £5.2 million, is ranked third.
“North west London ticks a lot of boxes for Russians,” says Mr Abrahmsohn. “The properties remind them of the dacha [country home] of Moscow. You can buy properties with up to three acres of land — which is like having a country home — and just 15 minutes from the centre of London. There is also an airport nearby and you get far better value than in central London.
“London is the capital of capitals. It is a cultural, culinary and media hotspot. To most potentates, dignitaries, presidents, kings and monarchs, London is where they have their second home. They buy homes in London whether they need to or not.”
He continues: “Usually their kids are educated in the UK. Owning a home in London is a statement of wealth, to impress their bankers, business partners and peers.
“Russians like to stitch themselves into the social fabric of the UK in order to protect themselves. They buy homes just to park their money.”
South African Mr Abrahmsohn has been working in the industry for more than 30 years. He studied dentistry before setting up Glentree in 1976. His first office was two borrowed desks in the upstairs bedroom of the Central Hotel, Golders Green.
He has since been joined by partners Jeremy Gee, Robert Kramer and Roz Florence, and the 20-strong team has recently moved into their new, state-of-the-art, £500,000 Golders Green offices, complete with Poggenpohl kitchen.
Is it not a dangerous time for a business to be spending on luxuries? Mr Abrahmsohn is upbeat about the future. “I believe the economy will pick up. People should not fear the property market.
“I think the recession, from a property perspective, will be shorter than people think. We found that the property market actually started slowing down in August 2007, so in the summer we will be two years into the slowdown.
“I don’t think prices will rise. I see a pretty flat, dull market this year. The opportunists will soak up the supply in the next three or four months.”
But Mr Abrahmsohn says now is the time for first time buyers to set up home. “This is a fantastic opportunity. At last, purchasers have some more power. You can lock in your mortgage rate, providing you can get a mortgage.”
He urges parents to assist their children to get on the property ladder and help them to get a deposit by either getting an equity release from their homes or by guaranteeing the mortgage. “With prices down by 30 per cent before tax, it is a very rosy scenario. We haven’t seen a selection like this for over ten years. Parents that haven’t bought homes for their kids should do so now. Don’t wait.” Besides, he continues, property is a safe investment. “In the 1990s, if you had cash and were sitting on cash, you would be earning 12 per cent on that cash, being eroded by eight per cent inflation. But there was still a four per cent real yield on your money.
“Today, you are earning one per cent on your money, and CPI inflation is around three per cent, so there is no real growth in your cash.
“Therefore, why should you sit with money in the bank? For wealth preservation, money in a retail bank that you know the government will support is probably not a bad thing. But it is a temporary measure. And with pension schemes so unpredictable, property is the best pension you could buy.”
Mouseprice
