Gains and costs of London Olympics

As it was already obvious, the London Olympics 2012 did not bring much profit to the city, as there was no sign of the expected enormous number of tourists and overseas visitors. According to official figures of the United Kingdom’s Office for National Statistics, in July 2012 total number of foreign travelers who visited London was 3.18 million – that is 180,000 fewer if compared to last year July. Most of all – about 2.12 million people – came from European countries, followed by tourists from China and North America.

The money spent by visitors in the capital of Great Britain also made only the sum of £2.01 billion (US$3.25 billion) – £120 million less than last year.

Meanwhile, the cost of the London Olympics was about £9 billion, so the figures of tourist arrivals and their spending do not look very positively. This is not the first time when such negative effect on tourism could be observed during the Olympics – Beijing and Athens saw the same fall of industry.

Olympic Games to affect hotel business and property rentals in London

Some months before the Olympic Games 2012, some people considered that London would be full of tourists and visitors, so that it would be hardly possible to find apartment for short stay in London. However, in reality, there were not so many tourists as normally in summer, and many hotels even had to reduce their prices, trying to attract people – for example, it became known from some sources that hotel in Hyde Park had to make 80% reduction of its rates. London visitors also chose more economic solutions of short time rentals.

Just before the start of the Olympics, the newspaper Property Wire predicted that possible rental shortages would result in a surge of lettings in September, 2012, as many tourists might choose to come in September not to risk the Olympic congestion. Also, according to Property Wire, the private rental market is successful only in Stratford, where most of Olympic events took place and not in the other districts of London.

The Olympic Games 2012 have made their effect on other branches connected with tourism. London museums were short of about 30 per cent of visitors if compared to usual summer rates. London taxi drivers said that their fares were down by 20-40% during the Olympics.

Foreign investors rise demand for London luxury property

According to the information by the leading global built asset consulting firm EC Harris LLP, over the next 10 years it is planned to complete more than 15,000 houses and apartments in London in the luxury-home sector. Such increase is revoked by huge demand from overseas investors.

By words of Mark Farmer, head of residential property in EEC Harris, the pipeline in London prime properties is unprecedented at the moment. The builders now expect to construct homes with a sales value of £38 billion, as it was stated by EC Harris. About 3,800 London homes are expected to be completed in 2016, as compared to this year’s 500.

Investors from overseas consider central London, where the most expensive areas are located, a safe place from economic and political issues in their home countries. As a result, the prices for property in London’s most prestigious districts are 14% above the previous peak in 2008, according to estate agents Knight Frank LLP.

Among the new luxury homes to be sold this year are the final homes at One Hyde Park, the Lancasters site across from Hyde Park, and probably the units in the Shard skyscraper across the River Thames from the City of London. Also, the Shard itself offers apartments on some of its floors.