Almost half London prime properties sell for the asking price - or more
Fri 07 Feb 2014
Almost half London prime properties sell for the asking price - or more.
The Prime London market experienced a bumper January in 2014, with properties selling in record time and for closer to the asking price than ever before, according to new data from estate agents Marsh & Parsons.
Over a third (34%) of property in January was sold within two weeks of being put on the market - twice as many properties in this timeframe compared to January 2013.
In addition, almost half (48%) of all property in January sold for, or in excess of, the asking price. This meant on average across all property sold, 99% of the asking price is currently being achieved - an increase from 98% during the past two years.
Peter Rollings, CEO at Marsh & Parsons, commented:
"Now is the time to get a jackpot price on property thanks to a surge of potential buyers entering the market in the New Year. These extroadinary conditions have created a strong seller's market and one of the best opportunities to sell property in recent years.
"But conditions like this won't last. Many people believe that the best time to market property is during the busier months of the Spring, but these sellers could be missing a trick - the increasing levels of property supply at that time of year will dissipate current levels of demand, and bring about a return to more normal market conditions in the spring."
In January, there were 23 registered buyers competing for each available property on Marsh & Parsons' books. This was the highest level since 2010, and represents a dramatic increase from the ratio of 14 registered buyers per property in January 2013. Compared to the same point last year, 19% more buyers entered the market in competition for 28% fewer properties - making this a strong seller's market.
But for the last four years, an average of 10% more property has become available between the months of January and April. This percentage jumped considerably between 2012 and 2013 as the property market recovered, and if this trend continues, 18% more property could hit the market by spring 2014.
Peter Rollings continued:
"London's rising population, together with a perfect combination of low interest rates and competitive mortgage finance has created a surge of potential buyers. But the supply of housing stock has remained more subdued. Our more astute sellers are putting their properties on the market now because they know that the imbalance of supply and demand will help them to get a great price.
"In a seller's market, property regularly goes for over the asking price, so buyers need to be realistic when viewing property and placing bids. When they find their chosen property, they must not delay. Being decisive is key to successful negotiations."
The average value of two-bedroom properties in Outer Prime London increased by nearly 100,000 during 2013 following a 17% annual growth, according to Marsh & Parsons' latest London Property Monitor.
The average price of a two-bedroom property in Outer Prime London - comprising non-central areas such as Brook Green, Fulham and Barnes - now stands at 673,812. This is an increase of 98,214 since Q4 2012, when the average price of a two-bed in these areas was 575,597.
Looking at average values across all property types, growth in Outer Prime London outpaced Prime Central London by 50% during 2013, with annual growth of 15%, compared to annual growth of 10% in the Prime Central areas of Chelsea, Kensington, Notting Hill, Holland Park and Pimlico.
The top five Outer Prime 'hotspots', where the highest levels of growth were recorded during 2013 were: Barnes (average annual growth of 19%, Balham, Clapham, Fulham (all 18% annual growth), and Battersea (15% annual growth).
Peter Rollings continued:
"Last year the biggest price increases were to be found in the Outer Prime London 'villages'. These areas are all popular with UK buyers and are favoured for their community feel and local atmospheres. Slightly lower property prices in these areas also attract those who may have been priced out of more central areas.
"But early indications in January point to a turnaround. While parts of Outer Prime London sped ahead in 2013, our data suggests that Prime Central areas are due for a growth spurt in 2014. This was beginning to happen in the third quarter of last year and looks set to surge forward later this year."