Gazumping returns in competitive London market

The prime property market in London recorded positive growth for £1m+ prices in May for the second month running, according to Knight Frank. Prices rose by 1.6%, four times the growth rate of April with the recovery led by the sub-£1m+ sector, while the slowest sector to recover has in fact been the £10m+ sector which price growth of just 0.8%.

The strongest performing locations are Mayfair and Marylebone says the agent, where prices have risen by 2.9% and 2.7% respectively.

Liam Bailey, Head of Residential Research at Knight Frank, said: ‘There has been a steadily improving picture in the central London market in recent months with buyers growing in number and deals beginning to shift upwards although the market is unrecognisable from where it was six months ago.

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‘The majority of the sales are in the £1m to £3m price range, and are two bedroom flats to medium sixed family houses with buyers seeking quality – on the best streets, upper floor flats rather than basements, and so on.

Supply is still thin, Knight Frank has noted, and is particularly so in the £1m - £2m range which is frustrating would be buyers, and has led to the return of gazumping, with the sealed bid system in use for the first time in 18 months.

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