London is the most important market in the UK; it is our capital city that generates more income than anywhere else in the country and it is also one of the most important economic cities in the world. The small number of sales in London compared with the rest of the country (Halifax states ?around? 15,000 purchases are made in the UK every month) accounts for well over half the fiscal value of the UK Housing market.
This value, however, fails to be weighted in with other national statistics and a result headline grabbing statements reflecting property trends nationwide should be treated with some caution. Companies such as Nationwide and Halifax which churn out monthly statements pay little attention to the London market.
The fact that investment from overseas and local sales continues at such a strong pace in London reflects continued confidence in our market, as well as a shortage of prime housing stock. This does seem to conflict with national statistics, yet the evidence can be found on lonres.com whose data changes every day (this information is unfortunately not available to the public).
While the traditionally quiet summer months of August and July proved very busy with sales at the top of the market very strong. Agents have reported that, since the beginning of the autumn window, buyers are not afraid of setting new records on a per square foot basis. While the number of actual sales in excess of £1,000 per square foot dropped, this was due only to the shortage of quality stock.
The market between £500,000 and £1,500,000 in September witnessed agents complaining about a lack of quality stock, and this has been backed up by a slight reduction in the number of transactions in comparison to the previous two months. Prices have continued, however, to remain firm and the latter part of September saw a steady increase of sales being agreed, and also with those properties that were proving hard to sell during preceding months.
Transaction levels in October remained consistent with those of September but unless more properties go on the market, it will inevitably slow down as buyers will not want to be compromised into buying for the sake of purchase before Christmas. This trend does, however, auger well for the New Year.
The London market in the autumn looks interesting as there have been reports that the big City bonus is back, and we have heard that they are already looking for their next new home.
Meanwhile, the lettings market reports that activity from tenants has been strong, and prices are holding firm. However, the lettings market seems to be mirroring the sales market with what appears to becoming a widespread shortage of stock. This manifested itself over August and has become progressively more difficult through September, yet in July stock levels were normal. There is no reason, as agents have maintained, to withhold your property from the market at the moment.
Right now, it would be difficult to predict how the market is going to react to both global events and economics, but early indications are that, for the last few months at least, it?s business as usual.
William Carrington is the co-founder of lonres.com – a property data-mining company that monitors the London property market pulse.
What is lonres.com? We provide data to all the recognized estate agents, valuers and surveyors in Central London; lonres.com is not a service to the general public. The data we provide to our subscribers show details of property for sale and to let, together with an archive of transactions. In the sales archive, this includes details dating back to at least 1986 and the original particulars are also available. Information relating to the enfranchisement of properties is supplied as well. The data is updated constantly throughout the working day, which means we can react and provide an accurate snapshot of market conditions daily or else provide the usual monthly and quarterly analysis.