5
Jan
Central London Leads Market Recovery
As we enter the New Year Nick Churton of Mayfair Office gives an
assessment of the London property market over the past few months
and some ideas about the coming year.
"Since the beginning of 2009 the Central London property market
has confounded just about every one involved with it. The
weak pound has attracted overseas buyers who have been absent for
some years. Buyers from France and Italy have been
particularly notable.
But buyers are being choosy. Locations such as Mayfair,
Belgravia and Knightsbridge have been especially popular but only
the best property examples are generating special interest.
Condition is very important, as is interior finish. Good is
no longer good enough. Exceptional finish is now the accepted
norm if a house or flat is going to get top price. This is
the international effect: expectations are high and this is
certainly having an influence on how London home-owners modernise
and improve their homes.
Well-appointed
properties in the best locations should continue to sell well - in
many cases at 2007 levels. This activity in prime Central London
will, no doubt, ripple out most quickly to the South East, central
south coast and prime centres, such as Oxford, Cambridge,
Winchester, Bath and York.
Whilst the stock
of property for sale remains extremely limited prices will be
forced upwards. But this could change rapidly in the New Year
if people are encouraged to come to the market through rising
prices – thus reversing the trend and creating a second dip
in property values.
However if the
supply of property remains relatively low because of continued rock
bottom interest rates and the fear of rising unemployment, there is
unlikely to be a repeat of the bargain prices of late 2008/early
2009. Also, any weakening of the pound against the dollar or
euro will see further interest from abroad that will positively
affect supply and demand for house sellers.
The general
election may also have an influence on the market. The
government will want to do its utmost to improve the public mood,
and we can expect that there will be further pressure on the banks
to increase the residential lending necessary to stimulate the
housing market.
Central and
southwest London are expected to lead the way in the house-price
recovery into 2010. With low levels of stock and growing confidence
and demand, buyers will be forced to broaden their search to find
value. Areas that have been lagging in the recovery will
benefit from this effect and there will be a direct impact on
prices as family movers push up house prices in metropolitan
suburbs and major towns. City centres, burdened with an
over supply of flats, will take longer to recover but as the
buy-to-let market gathers pace these areas will also begin to show
signs of improvement."
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