Taylor Scott International News
Prime London house prices rose by an average of 2.6% in 2014, but for the first time since the credit crunch the UK’s prime regional markets marginally outperformed the capital with growth averaging 3.2%. According to the latest analysis from Savills 2014 was a year of two halves for the prime London residential market. Prices rose by 4.9% on average in the first half of the year and fell by a net figure of 2.2% in the second half, its prime London index shows. The firm says that the increased rates of stamp duty introduced by the Chancellor in his Autumn Statement resulted in an adjustment in values at the top end of the market, most notably in prime London and parts of its high value extended commuter belt. As a result, the average all prime London index where values average £2.6 million recorded a 2.6% fall in the final quarter of 2014. However, London’s prime markets up to £1 million and in the £1 million to £2 million range were less adversely affected by the stamp duty changes and would also be less affected by opposition proposals for a mansion tax. As a result, they saw annual price growth of 6% and 2.5% respectively. The greatest impact of the stamp duty increase was seen in the most valuable markets of prime central London, which have seen the strongest price growth in recent years. In these central markets, where prices average £4 million, values fell by 4.2% in the last quarter of the year, contributing to small falls of 1.3% year on year. ‘It will take time for the effect of the stamp duty changes on prices to become clear, early signs are that the additional cost is predominantly being borne by sellers through price adjustments at a level similar to the extra stamp duty,’ said Lucian Cook, Savills UK head of residential research. ‘Prices were easing before the Autumn Statement, so for the very top end of the market the stamp duty rise coincided with some of the froth coming off pricing earlier in the quarter. Our analysis suggests that even without the stamp duty changes, values were on track to soften by around 1% in this last quarter, in part due to general pre-election uncertainty around high value property taxation,’ he explained. Early indications are that the prime markets outside London have been less impacted by the new stamp duty rates and would also be less affected by further taxation in the form of a mansion tax. In the sub £1 million prime market across the UK, average prices rose by 4.6% in 2014, fuelled by particularly strong growth in the first six months of the year. These lower value prime markets, particularly those that are well-connected to London, are forecast to see the strongest growth over the next year and… Taylor Scott International
Taylor Scott International, Taylor Scott
