There's heavy rush to buy rental apartments in London property market ahead of new tax on home coming into effect from April 2016. The buying demand is pushing prices up. 

London is one of the most expensive property markets in the world. Investments soar in the wake of three percent stamp duty in April this year. The London market is gaining momentum on the strong buying demand from investors, who're in a hurry to close the deals to avoid the new tax, according to Royal Institute of Chartered Surveyors. 

Market Watch reports that the proposed stamp duty will add three percent to the purchasing price in London property market. The property prices are going up. The average price reached to a record level of £514,097 ($744,450) in December 2015, as per the Land Registry. The UK government has rolled out several measures for tempering the appetite for rental homes. 

Simon Rubinsohn, chief economist at RICS, said: "There is a rush on. There's recognition that the numbers will look more challenging when you have to pay another three percent."

Rental homes market is a popular form of investment in London, which is property-obsessed city. The UK government has been implementing several policies supporting home ownership. However, the home ownership is a bit difficult for first-time buyers in the wake of severe shortage of housing. Adding to this, the constrained mortgage situation is further keeping pressure on the first-time buyers.

Recently the public consultation on the 'second homes tax' was concluded in the UK. An extra three percent surcharge will be imposed on the properties in the UK classified as second home. Investors consider London property market as most attractive and safest in the world. However, there's apprehension and concerns about the future course of direction, as reported by Gulf News. 

Analysts advise investors to be optimistic about the London property market as reforms are expected to create more diverse market. London property market offers potential long-term gains for investors. The professional counsel will be needed alongside the implementation of reforms. Investors need to take more attention to mitigate the risk factor. 

The new research report from National Landlords Association (NLA) indicates that selling of 500,000 properties over next 12 months. The landlords' confidence is weakening since the recessionary days of banking crisis. The proposed selling volume by landlords in next 12 months more than doubled since July 2015. The sudden negative attitude toward property market follows George Osborne's double-whammy tax attack on the real estate market, according to The Telegraph.

The prime locations in Central London are witnessing some pressure. Zones-1 and Zones-2 can't be avoided. It's forecast that zones 3 to zones-6 are expected to witness robust activity. The reconfigured market will offer a lot of variety in location and price aspects to the investors.