Taylor Scott International News
Buyers in the prime central London property market are still cautious with the £5 million plus sector seeing particularly low activity levels, according to new research. There is an increasingly polarised market in this sector where growth is still being seen at the lower end and high end sales are limited in volume, according to the latest statistics covering the third quarter of 2015 from Strutt & Parker. ‘Whilst some commentators are predicting falls in values across the market, we believe these positions are being disproportionately impacted by the £5 million plus segment of the PCL market, which has experienced particularly low activity levels in 2015,’ said Stephanie McMahon, head of research at Strutt & Parker. A total of 720 properties were sold during the third quarter of 2015, a fall of 3.7% compared to the same period last year. Compared to the five year quarterly average, the total volume of transactions were 17% down and flats remain the preferred purchase, accounting for nearly 57% of . The research also shows that the downturn in price growth in 2015 has reduced the number of these properties entering the market as discretionary vendors are willing to wait for prices to recover. This is matched by increased buyer caution as Stamp Duty reforms, an accumulation of recent tax revisions aimed at high net worth property owners, and a strong pound, have discouraged foreign investors from entering the UK market. Overall, this has resulted in investors taking longer to make decisions and considering alternatives. These trends look set to continue for the remainder of 2015 with the ultra-prime segment likely to show zero and in some cases negative growth. However, sellers placing properties on the market that are sensibly priced and good quality will continue to do well. ‘Since the summer break, increasing activity in PCL shows that buyers and tenants are making the most of relative aligning of asking prices. There is no doubt that confidence is on the up and the considerable tax changes of the last few years are now being regarded as the new norm,’ said Charlie Willis, head of London residential at Strutt & Parker. The data also shows that there were 3,936 property lets agreed in PCL during the third quarter of 2015, which was just 1.9% below the five year quarterly average. Zoë Rose, head of London lettings at Strutt & Parker, explained that the PCL lettings market has experienced a slowdown, particularly affecting the three and four bedroom mid-market. ‘That said, demand for one and two bed properties from young professionals remains robust and uncompromising. Properties that are well presented continue to rent successfully,’ she added. ‘The prime London markets have slowed over the past 12 months with the spate of intervention from the government, combined with a strong pound. The coming year brings further uncertainty with the Mayoral election and lobbying around Brexit,’ McMahon pointed… Taylor Scott International
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