View of London
London’s prime-resi property market has accelerated notably in recent years, particularly in highly desirable areas like Mayfair.
Listings in this sought-after part of central London are up 67 per cent compared to 2014, and up 25 per cent compared with last year. One of the area’s most prestigious and longstanding estate agents, Wetherell, notes in a recent report that there is currently £750 million worth of residential property listed for sale, an impressive figure when looking at the impact of buying factors like BREXIT and the US election results. Given that foreign investors prop up much of central London’s property market, it is to perhaps be expected that the latter part of the year saw prices and transaction volumes fall across the capital, with PCL being no exception. However, the number of properties on the market in Mayfair is still impressive, and with interest rates remaining at a record low and the pound still fluctuating, now could be the time for overseas investors to find a deal in one of the most luxurious parts of London.
Luxury property becomes more affordable
Looking at London as a whole, the rate of price growth reached it’s lowest point in two years following Brexit, which has made luxury property more affordable in some areas.
London’s average house price is now £482,800, while the average house price in Mayfair is £5,971,591. This area of the city has been notable this year as the availability of properties priced below £1 million has dissipated, with it expected to be all but impossible to obtain in the coming years. However, there is a good choice of property on the market in terms of variety; compared with August of last year, there are 40 per cent more flats on the market, although houses have fallen by 37 per cent when comparing the same period. This puts buyers in a good position, especially when considering the number of homes sold for £10 million or more in prime central London fell substantially, particularly when compared with the rest of the PCL market. According to data from LonRes, from January to August in 2015, sales of properties valued at £10 million or less were down by 19 per cent. In comparison, rates were down by 44 per cent over the same period in 2016.
The EU referendum results have no doubt cast a shadow over the prime-resi market in London, as is the case looking at London and indeed Britain as whole. The impact on buyer confidence and the affect on the sterling may has been notable, but the number of properties still arriving on the market in Mayfair suggests there is substantial resilience when examining this particular submarket. Once described by Wetherell CEO Peter Wetherell as being like “a strong ocean liner sailing in a protected fjord,” Mayfair appears to have remained continually popular with high net worth individuals over the past two to three years. Taking that into consideration, it’s unlikely that London-wide market volatility will have much impact in this pricey pocket of the capital.
With this in mind, buyers who are still in the market for properties priced at £10 million or more have less competition and therefore a greater choice of selection, as the number of properties listed at £10 million or more across PCL as a whole has risen from 100 last year to 125 (correct as of August 2016). According to experts, the key to finding the right property lies with working alongside an estate agent that knows the area well, and can provide links to off-market properties in highly desirable areas, such as that of Mayfair.
