Fewer transactions and properties withdrawn from the London property market as the election looms. Richard Barber, director at W.A.Ellis, a JLL Company, comments on the prime London sales market:
“Spring is usually a busy period for the property sales market, but it has started slowly this year as agents and their clients await the ‘watershed’ that the general election is turning out to be. Whilst there are undoubtedly headline transactions taking place, turnover has diminished dramatically in the first quarter of 2015 with year on year sales for March reduced by approximately 33% (source Lonres).
“Discretionary sellers are taking a somewhat lackadaisical approach towards the potential sale of their properties, whilst more focused vendors at the upper end of the market are already cutting prices in search of that elusive buyer.
“Within our chosen postcodes, broadly covering Kensington, Chelsea, Belgravia and Knightsbridge, 87 properties have been withdrawn from the market as vendors either decide to try later in the year, or to ‘quietly market’ their homes, away from the internet, where canny buyers will negotiate strongly on properties that appear to have been stuck on the market. In the same period in 2013, only 63 properties were withdrawn, perhaps illustrating the weaker sentiment that we are experiencing this spring.
“In the broader market, whilst affordability is undoubtedly a factor, for those lucky enough to have deposits, or able to turn to the ‘bank of mum and dad’, to provide them, now could prove to be an opportune time to buy, with the reduction in SDLT and the most competitive long term borrowing rates that we have ever experienced. With long term swap rates softening in the face of continued deflation, it cannot be long before we see one of the big lenders introduce a five year fixed mortgage rate at 1.99%.
“Low mortgage rates, coupled with new rules allowing people to release pension funds at 55 will, undoubtedly, fire the ‘middle market’ both within London and prime university cities. This, in turn, will lead to questions regarding the supply of affordable housing and the ever widening gulf between property owners and ‘generation rent’. This is entirely understandable but can only be rectified by more flexible lending criteria and a non-politically driven policy towards increasing building of affordable housing.”
W.A.Ellis is currently marketing a range of properties on the sales and lettings market.
For further information, call: 020 7306 1600 or visit www.waellis.com