Prime property market in London has plateaued as prices stabilise, it is claimed
Fri 08 Aug 2014
The prime property sector in London has reached the top of the market with prices stabilising and the number of registered buyers falling, according to the latest report from agents Marsh & Parsons. Overall the supply of property has increased by 26% in London since March 2014 while the number of registered buyers per property has fallen from 24 in January 2014, to 16 at the start of June, the report says.
The firm also points out that quarterly house price growth in prime central London has slowed to 2.1%, half the 4% increase witnessed in the first quarter of 2014 and in the last month there has been very little change in property prices as growth has stalled.
In the past six weeks, we have seen the wind change in the property landscape, restoring a new calm and steadiness to the market. Property prices have plateaued as more property has come onto the market. However demand continues to outweigh supply, in what is still a sellers market, said Peter Rollings, chief executive officer of Marsh & Parsons.
This renaissance of supply is offering buyers more choice than theyve enjoyed in recent months and is also good news for sellers searching for their onward purchase. That said, sellers should be prepared to adapt to these cooling conditions, he added.
Rollings pointed out that 2014 saw one of the busiest starts to the year, and up against such limited housing stock and fierce competition for available properties, buyers were left with very little breathing space. House price rises may have grabbed the headlines this year but double digit annual increases are not sustainable, and as the market self regulates itself, sellers and estate agents need to adjust their price expectations accordingly, explained Rollings.
We believe this slowdown in price growth is a healthy and organic development. The market should be allowed to take its natural course. Ramping up interest rates or making mortgages more expensive would be a gross over reaction, which could harm the wider market outside of the capital, where the story is very different and recovery is only beginning to take shape, he added.