Agent says flat's 50% price rise 'defies logic'

An agent has been quoted in a national newspaper as describing the asking price of an off-plan flat - going to the market shortly at 50 per cent above its sale price in the spring - as defying all logic.

Chris Innes-Ker, associate at John D Wood & Co's Battersea branch was asked by The Guardian to comment on the asking price of a studio flat in the Battersea Power Station development.

The flat sold off-plan in the spring for close to £1m according to the paper, which claims it is about to go to the market for the second time in six months, at £1.5m.

The paper says it is likely to be marketed by Henry Wiltshire, described as an upmarket estate agent that is setting up an office in nearby Vauxhall, is close to being appointed to handle the resale of the studio apartment on the fifth floor of the power station.

Innes-Ker says the new price, despite 50 per cent inflation in a few months, is nonetheless credible. It's an entirely separate market from what's going on in the real world. It seems to be defying all logic. It's creating a market of its own he told the newspaper.

The flat, which of course is not even built yet, is one of 254 that were launched in May; prices for studios started at £800,000 and larger units were marketed at £4m and above. They are scheduled for completion in 2018.

Kyle Spence, Henry Wiltshire's sales director, told The Guardian that the vendor was hoping to see the apartment at between £1.4m and £1.5m.

The 50 per cent increase in asking price between May and late November, when the story broke, comes just as another high end estate agency - Knight Frank - is admitting that prices in prime central London are now falling for the first time in years.

Prices fell 0.2 per cent in November, which was the first drop since October 2010 and meant annual growth eased to 6.1 per cent. Discounting a minor dip in the second half of 2010 due to concerns over the euro zone, November marked the end of a run of growth that lasted five and a half years, during which time prices rose 73 per cent says a Knight Frank spokesman.