Prime Central London Remains An Extremely Desirable Place To Live
After an extremely promising start to the year, the early spring was disappointing.
It would appear that much of the pent up demand from the latter part of 2012 was satisfied in January and early February. The rest of the February and March were quieter, both in terms of the amount of property coming to the market and numbers of serious applicants looking to buy.
The absolutely ghastly weather accounted for a great deal of the reluctance on both sides. May and early June however have seen a very marked increase in activity with a healthy level of sales been agreed. With 233% more deals being agreed in May than April. Registration of applicants in May was 37% down on April.
Whilst overseas purchasers so far this year account for 59% of our buyers, as the chart below demonstrates, the widely held belief that the British have been almost entirely priced out of prime central London is not correct, in our experience. It proves that prime central London remains an extremely desirable place to live, as well as being an excellent place in which to invest.
Also of considerable interest, is the fact that only 27% of our buyers, so far this year, are buying for investment purposes, with the remainder intending to use the property as their main home, a home for their children or as a London pied-a-terre.
A small proportion of sales have been to developers intending to refurbish and add value before re-launching them back to the market. There is no doubt that foreign investment into London property is very substantial but the stock just isn’t available in the prime areas in which we deal. The picture is clearly different where there are large new developments in other areas.
Prices have already risen this year. Although the lack of volume in the market place means that to talk in terms of average percentage increases, is fairly meaningless. However, the continuing low volume of houses and apartments coming to the market means that demand outstrips supply by a considerable margin. Accordingly, talk of current price levels being unsustainable has no foundation.
As we have seen many times in the past, whenever a country or region somewhere in the world prospers, some of the wealth created ends up in the prime central London residential market and conversely, when any regions experience problems, some of the wealth looks for a safe haven in London.
A classic example being the numbers of obviously wealthy French looking at property to rent or buy in order to escape the mess Mr Hollande is making on that side of the channel.