- Readers Rating
- No Rating Yet!
- Your Rating
Property prices in prime central London fell by 1.1 per cent in the year to February 2018 according to new analysis from Knight Frank.
Stamp duty and political uncertainty have caused the sector to stagnate according to new analysis. The average asking price reduction between £1 million and £5 million was 9.9 per cent during the 12-month period. At the same time, the supply listed for sale stood at 5.4 per cent higher.
Despite some hesitancy from buyers, there is a general consensus that the market is more stable, according to Tom Bill, head of London residential research at Knight Frank. This is in spite of the fact that prices are 8 per cent below their previous peak in August 2015.
Prime central London prices have stabilised, and in line with this so have trading volumes. A 2 per cent increase in sales volumes was recorded in the year until February 2018 in comparison to the previous 12 month period.
Bill explained: ‘While the market remains sensitive to political events there currently appears to be a sense of relative stability being restored The impact of stamp duty has been substantially absorbed and is now an accepted cost of transacting. Indeed, an analysis of asking price reductions over the last year shows pricing has more than adjusted to take higher transaction costs into account. This over compensation suggests the market has also undergone a process of self-correction following the bull market run between 2009 and 2014.’
The report has indicated evidence that property owners are responding to the fact that pricing and sales volumes are bottoming out. The number of properties listed for sale in prime central London was up 5.4 per cent in February 2018 in comparison to the same month last year, according to data from Rightmove.
However, Bill argued that we are unlikely to see a strong uptick in pricing or sales volumes. He said: ‘Political uncertainty surrounding the Brexit process and the finely balanced arithmetic in Parliament is providing continued grounds for caution.’