Here Richard Barber and Lucy Morton of London estate agent W.A.Ellis bring their most recent insight on the Prime Central London property market:
Richard Barber, partner in residential sales: “Transaction levels in SW1, SW3 and SW7 for the period September – November are up 11% year-on-year (Lonres), and capital values for the same period are 4.1% up, but demand is still strong and outweighing supply. Sellers are achieving 97% of their guide prices in Central London, and we expect these percentage levels to be maintained while stock levels remain sparse.
“Since September, we have valued in excess of £140,000,000 worth of property, ranging from studios to large family houses. These potential sellers are undoubtedly in a strong position in this market but, as always, there are a variety of reasons for people wishing to sell.
“For those selling who want to stay in the market, there is an understandable hesitancy to put their own properties up for sale when there is little choice for them to move to, as a result, we have seen some unusual compromises. A recent sale has seen an exchange with a two year completion to give the seller ample time to find the right property to move to. If this only takes a couple of months, the completion date can of course be brought forward, but the price is committed and it focuses the mind of the vendor to find the right property.”
Lucy Morton, senior partner and head of lettings:
“After a record breaking month in September with the completions at their highest in our history, we have seen a notable slowdown in activity in the rental market this month with enquiry levels down by 25%. The half term break in October has seen many prospective tenants, particularly families, leaving London to chase the last of the European summer sun, as well as those tenants that have shrewdly already secured accommodation ahead of the winter months, which has led to us seeing a 7% increase in rental transactions in October this year against the same period last year.
“With this month’s publication by the Office of National Statistics suggesting the economic outlook in the UK is set to improve following a third successive quarter of growth, we have seen a notable rise in the number of tenants renewing their tenancies in October. Whilst this is typical for this time of year as tenants seek security over the Christmas period, it is also coupled with an increase in the number of corporate tenancy placements that are extended as blue chip companies in particular return to the rental market at a pace. We are on average achieving rent increases of just under 3% on renewals.
“Notable lets this month include a five year agreed term (a deed) on a spacious family house in West Chelsea, as well as a stunning 2,300 square foot first floor apartment on Pont Street going under offer. We have valued and taken on some fantastic stock over the past few weeks, and once again maintain that presentation is absolutely paramount to securing a quick and successful tenancy, particularly given the time of the year. Although we have seen enquiry levels drop considerably in comparison with September, we have a number of high net worth tenants in the market (some with budgets in excess of £10,000 per week) which leads us to believe that the post-half term weeks should see the market come back to life for one last big push before Christmas.”
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