Prime Property Prices in Central London Still Rising

This article of the Property Wire on August 26, 2013 shows that prime property prices in central London continued to rise in August but there are indications that buyers are becoming more resistant to continued price rises, especially at the top of the market.
 
The latest central London sales index from Knight Frank shows that property prices in London’s best postcodes increased by 0.6% this month and so far this year prices have risen by 4.8%.

Marylebone and Notting Hill recorded the largest rises over the course of the month, up by 1.5% and 1% respectively. Islington, City Fringe and Hyde Park all reported price growth of 0.9% in August.

In spite of record prices, enquiry levels are still robust and interest among prospective buyers remains high across central London. The number of new applicants is up by 33.9% over the year to date compared to the same period in 2012 and the number of property viewings conducted over this period is up by 18.5%.

At the same time annual price growth for properties in Greater London is now outstripping prime central London, boosted by the city’s continued economic recovery and government policy.

Figures from the Office of National Statistics show that property prices in Greater London have risen by 8.1% over the past 12 months. In comparison the Knight Frank Prime Central London Sales Index is up by 7% on an annual basis.

Price rises in prime central London are primarily being driven by homes in the sub £1 million and £1 million to £2.5 million price bracket.

Homes in these price brackets increased by around 1% in August and are up by 8.7% and 7% respectively over the year to date. Comparatively, homes in the £5 million to £10 million and the £10 million plus price brackets increased in value by 0% and 0.2% month on month and are up by 2.6% and 1.6% respectively so far in 2013.

Knight Frank says that key factors driving price growth and interest include the city’s reputation as a safe haven for investment, and the value of the pound. However the firm’s global head of residential research Liam Bailey pointed out that performance has outperformed forecasts.

‘Last year, we forecast that prices would remain unchanged in 2013, marking an end to the strong run the market has seen since early 2009. Our rationale was that the increase in Stamp Duty would have an impact on the top end of the market and there would be resistance to price growth from domestic and international purchasers,’ he explained.

‘In the event we overstated the negative impact of the 5% to 7% Stamp Duty rise for £2 million plus properties. The further weakening in sterling in the first half of the year helped to boost overseas interest and domestic demand has been aided by London’s continued economic recovery and, arguably, from the government’s Help to Buy scheme, which was launched at the end of the first quarter this year and has boosted sentiment across the market,’ he added.

He also said that while Help to Buy, with its £600,000 valuation cap is a more significant factor in the wider mainstream market, rising housing market sentiment, as reported in the firm’s latest House Price Sentiment Index, is infectious across markets and price brackets and is likely to act as a positive influence in terms of future pricing, even in London’s prime
market segments.

‘We have therefore raised our forecast for prime central London price growth for 2013 to 6%,’ he added.

Article Source: http://www.propertywire.com/news/europe/prime-london-property-prices-201308268161.html

Prime Central London Property Prices set for Further Growth in 2013

This recent article by the Property Wire shows how the property houses continued to increase in Prime Central London.

Tuesday, 30 July 2013 Property prices in prime central London increased again in July, up by 0.5% month on month and so far in 2013, prices for the very best homes in London have increased by 4.2%.

And over the last 12 months prices have grown by 7%, according to the latest prime central London index from property firm Knight Frank.

The strongest price growth has been in the sub £1 million market and the biggest rises in June were in Islington and Marylebone where prices increased by 1.1% and the South Bank where they increased by 1.5%.

‘In spite of new record prices, interest among prospective buyers remains high. Property viewings in prime central London over the year to date are up by 15% compared to the same period in 2012 and the number of new applicants is up by a similar level. Rising demand has translated into higher sales volumes, up by 8.2% year on year,’ said global head of residential research Liam Bailey.

‘Last year, we forecast that prices would remain unchanged in 2013, marking an end to the strong run the market has seen since early 2009. Our rationale was that the increase in Stamp Duty would have an impact on the top end of the market and there would be resistance to price growth from domestic and international purchasers,’ he explained.

‘In the event we overstated the negative impact of the 5% to 7% Stamp Duty rise for £2 million plus properties. The further weakening in sterling in the first half of the year helped to boost overseas interest and domestic demand has been aided by London’s economic recovery and arguably from the government’s Help to Buy scheme, which was launched at the end of the first quarter of this year. We have therefore raised our forecast for prime central London price growth for 2013 to 6%,’ he added.

The report also shows that there remain differences in performance between locations and price bands across prime central London. In July, property in the sub £1 million bracket increased in value by 1%, while homes in the £1 million to £2.5 million price bracket climbed 0.6%. Comparatively, the price of super prime homes in the £10 million plus sector remained unchanged over the course of the month.

Article Source: http://www.propertywire.com/news/europe/prime-central-london-property-201307308059.html