Prime central London is experiencing a 25 percent year-on-year reduction in sales transactions as buyers adopt a wait-and-see approach for both political and economic reasons, according to real estate agency W.A. Ellis.
Richard Barber, partner at prime Central London agency W.A.Ellis, said: “We’ve seen a 25 percent reduction year-on-year in sales at all price ranges across our prime central London areas – Belgravia, Chelsea, Knightsbridge/South Kensington, Chelsea, Mayfair, and Kensington).
“For example, in June 2014 only 185 properties were sold, compared to 249 properties in June 2013. It is the underlying reduction in the volume of transactions which is of most concern as we enter the traditionally slower summer quarter.
“The proportion of sales sub £2 million (S$4.24 million) has also reduced, but only marginally from 67 percent to 62 percent. However, when one looks at the actual number of sales, a more disturbing trend emerges – namely that only 115 flats have been sold in June 2014 beneath £2 million (S$4.24 million) within our chosen postcodes.
“Perhaps the most frightening statistic of all is that only 27 houses were sold in June, whereas last year 49 were sold – a reduction (in transactional terms) of nearly 45 percent. The underlying factors are very apparent to close observers of the market; the combination of mansion tax threats, higher stamp duty, ATED and the fear of a Labour government is having a cooling effect on the market in general, but is particularly swingeing within the family house market.”
Barber added there are currently 374 houses for sale within our chosen areas and approximately 92 percent of them have a price tag in excess of £2 million (S$4.24 million), so it is not entirely surprising that the transaction level is lower.
He said: “It is apparent, however, that the traditional buyer of these houses (northern European/British origin) is currently weighing up the situation (both political and economic), and perhaps adopting a ‘wait-and-see’ approach.
“What is clear is that keen vendors will need to adjust their expectations if they wish to find a buyer this summer.
Barber concluded by saying that his company has achieved 99 percent of asking prices since January 2014, which he says underlines the importance of accurate and responsible pricing in a changing marketplace.
Andrew Batt, International Group Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email andrew@propertyguru.com.sg
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