Upmarket property search agents Property Vision (www.propertyvision.com) have said there is already a downturn in the property market this year, although the prime and super prime markets are less affected: ‘the market we operate in is more nuanced with, crucially, less debt and less supply,’ the latest report explains.
London, in particular, continues to be the destination of choice for buyers looking for a safe haven for themselves and their money. This pushes up demand for the so-called ‘super-prime’ properties – even where the mere ‘prime’ market is softening.
Property Vision’s report also clearly spells out the difference between these two top-end markets: ‘Super-prime is probably best described as property which a billionaire would buy without concerning him or herself too much with comparable values. Super-prime should not be defined by price only, as sooner or later (if prices carry on up), almost anything eventually gets there.
Equally, the buying agents think ‘prime’ is another overworked word, now being applied to some unlikely areas to justify unlikely prices: ‘Perhaps prime could best be defined as where typical successful international investment bankers aspire to live. Note the word ‘aspire’: they may have to, or choose to, live in Clapham for instance – but that doesnt make it prime.’
This definition will matter more if credit continues to tighten and bonuses lower, says the buying agents.
‘It is one thing to spend 100% of your bonus on a house in Kensington, but quite another to borrow 100% of the value of a house in Fulham. The former will probably continue to happen – but at more subdued prices and volume. The latter could well become a distant memory.’