It is always good practice to take stock and assess the market at the end of January to see what the London property market 2015 has in store. It’s a long month and much can happen that will set the tone for our expectations for the year ahead.
To set the scene, 2014 was very much a story of two seasons. The first six months was frantic in sales whereas the lettings market was a little patchy. However this position reversed in the summer with the lettings department experiencing frantic demand all the way up to Christmas and our sales department finding life a little more challenging.
January has started with a bang. Our sales department have already been dealing with four properties which have gone to sealed bids, interestingly across prices ranging from £500k to £4.5million.
The market is much livelier than we expected with plenty of buyers around to snap up good properties – even if it means bidding over the asking price to seal the deal. The key difference this January is the market sentiment. Last January there was a freneticism about the market as buyers scrambled to secure properties before prices rose further and for some, beyond their reach. This year, things are a lot calmer. Whilst we don’t expect prices to climb steeply this year – we don’t expect them to drop sharply. After price rises of approximately 20% in central west London last year, I expect 2015 will bring single digit rises in the region of 5% to 7%. It feels like a fair and balanced market for all parties and I expect that to continue for the next few months.
As always the main threat to the market is lack of stock. This hasn’t been a problem for us thus far this year but it may be more of an issue towards the end of the quarter as people hold off putting their property for sale before the election on 7th May. We will see.
The sudden but long overdue revamp of the stamp duty system announced by George Osbourne in his autumn statement in December had surprisingly little effect on our market with those adversely affected by the new structure accepting that they had to pay more tax, in some instances resulting in the buyer and seller sharing the extra burden via a small adjustment in the agreed sale price.
Some commentators on London property have predicted a decline this year in sales above the £2m price point. Whilst this section of the market is definitely more cautious than at this time last year, good properties are still selling as people seem willing to take a long term view on the market which, as we all know, is always wise!
All in all, it’s been a great start to the year and I look forward to a stable 2015.
Director – Head of Sales, Mountgrange Heritage
29 January 2015