London’s Prime Housing Market ‘Booming’
New analysis of the prime central London housing market for the first quarter of 2021 has revealed that there has been a bit of a boom in activity over the last few months, with new instructions rising by 72 per cent and transactions by 40 per cent, driven by the extension of the stamp duty holiday.
A study, carried out by LonRes (a tool used by most real estate agents) and reported on by Property Industry Eye, revealed a rise of 18 per cent on new instructions throughout the whole of Q1 2021 compared to the same quarter last year, although it is still down one per cent on the five-year average.
While all price brackets saw an annual rise in sales, the market below £1 million was the busiest for the quarter, seeing a 52 per cent hike in the number of properties sold, compared to the same time 2020.
This is unsurprising, given that this is where the biggest saving of the stamp duty holiday of £15,000, as a proportion of total buying costs, was to be made. The £5m+ also saw the biggest activity since 2016.
The first two months of this year saw new instruction levels relatively subdued, but this could potentially have been down to the fact that it was expected that the stamp duty holiday would end on March 31st.
Following Rishi Sunak’s announcement in the Spring Budget that the holiday would be extended for a further three months, with a tapering until September, market confidence was boosted, coupled with the rollout of the vaccine programme and the publication of the roadmap out of lockdown.
This saw new instructions climb in March, with 24 per cent more properties being listed than the five-year average for the month and 72 per cent more in March last year.
The super-prime property market also appears to be performing well at the moment. Last year, it was the world leader in prime property.
Some 201 such homes were bought in London - a three per cent rise compared to 2019 and this despite the fact that the market was closed for months, travel restrictions were in place and the nation was in lockdown. Hong Kong was knocked into second place, with 169 sales, as a result.
As for now, post-Easter is the time of year when the housing market really does gather pace, with an active few months expected before the inevitable slowdown, come the summer months. This wasn’t seen last year, of course, because we had been in lockdown for nearly a month by April.
However, the last time sales were as high as they are now was in July 2014, just six months before a stamp duty increase in December and near the height of the market. Knight Frank is now predicting 25 per cent cumulative growth in prime Central London between 2021 and 2025.
Buyers are still seeking best value, and price sensitivity and realism remain key to achieving a completion or sale. Get in touch with London buying agent Address Property Consultants for further help or advice.