Might the central London market gloom be broken by just a sliver of light?
London Central Portfolio, an investment consultancy, has recently chronicled the low levels of sales and buyer interest across the most expensive parts of the capital, but now it senses a small sign that the worst might just be over.
It says that annual transactions in Prime Central London in April were just above the record lows seen in the previous two months and stood at 3,295. This was a fall of 16.0 per cent annually amounting to just 63 sales per week on average.
However, LCP chief executive Naomi Heaton says: “Despite this glum picture, transactions have seen an almost 25 per cent increase over the last quarter. This has translated into a spike in prices of 13.2 per cent. On an annual basis, average prices now stand at £1,930,472.”
Heaton says this can be attributed to increased activity seen since last December. But there are still many clouds on the horizon, she says, most connected with Brexit.
“Investors came back into the market to capitalise on weak sterling and suppressed prices, before an anticipated uptick post the intended March 29 deadline to exit the EU. Now that the government has kicked ‘the can down the road’, this flurry appears to have subsided” she warns.
“It is therefore difficult to tell whether we are seeing the green shoots of a market recovery or a false dawn. Nevertheless, it is indicative of the weight of money waiting to return to the market.”
LCP’s analysis of the market for Greater London - far wider than the PCL sector - shows an annual price rise of 2.5 per cent.
This is despite annual transactions falling by 4.6 per cent to just 85,898 - that’s 26 per cent lower than at the EU Referendum in June 2016.
However, LCP warns that across England and Wales the market “has caught a Brexit cold” with prices falling monthly by 0.8 per cent and over the quarter by 204 per cent. Annual transactions continue to fall slightly and now stand at 800,091.
“With a common consensus about Brexit appearing to be some way off with the collapse of cross-party talks, there may be little short term improvement to the status quo” cautions Heaton.