London Recovers

Wednesday, April 21 2004

Prices in London are rising once more, particularly at the top end of the market, according to Knight Frank’s figures for March this year.

London prime property prices rose by 0.5% last month, bringing the total rise to 2.5% this year, according to their figures.

Prices at the very top end of the market are showing the strongest gains, the survey found, with £3 million+ properties rising by 1.3% in March and properties between £2 million and £3 million rising by 1.2%, which is over twice the average London prime property rise of 0.5%.

They have also calculated this means for the first quarter of 2004 properties over £3 million have risen by 3.5%, implying average rises of well over £100,000 over the past three months in the capital.

As to who is buying prime London properties, Knight Frank found 32% of buyers are foreign nationals, with 12% being north American and 14% European, signalling a return of the north American buyer compared with last year.

Liam Bailey, Head of Residential Research at Knight Frank said: ‘The prime property market in London is staging a strong recovery after a lacklustre 2003. Over the last six months foreign investors and a renewed interested from the city have helped push prices up at the top end.

‘Price growth in the second quarter may be expected to match or slightly exceed that seen in the first quarter, although it is unlikely that such growth rates will be sustained in the second half of the year as more stock enters the market and anticipated interest rate increases occur,’ he continued.