Press Release: Buyer competition sparks renewed bidding war in Londons housing market
Fri 18 Feb 2011
The gap between offers and asking prices in the central London property market closed dramatically in January as competition amongst buyers for prime properties intensifies, according to estate agent Marsh & Parsons.
In January 2011, the average offer submitted was just 3% below the asking price for the property the smallest difference since May 2010. The decrease is a far cry from the difference between asking prices and opening offers two years ago. In January 2009, the difference was nearly three times as wide at 8.6%.
Peter Rollings, CEO of Marsh & Parsons, commented: "Resurgent demand for prime property has, in many cases, created a sellers market in the capital. Weve come a long way since the depths of the downturn two years ago, and are no longer seeing buyers trying to vastly undercut asking prices with cheeky opening bids. In fact, were beginning to see the exact opposite. In many of Londons prime locations, fierce competition from an influx of foreign investors - and UK buyers pre-empting the stamp duty rise - is beginning to spark bidding wars for the very best properties, in some cases pushing prices beyond the original asking price."
In January, there were an average of 14.3 applicants per property, as a growing number of international buyers look to invest in London. This competition is the fiercest since March 2010, and there are 27% more applicants per property than in August, 2010.
Peter Rollings continues: "Demand from international investors has been particularly bubbly in the last month, and is helping to drive activity in London's prime property market. Alongside strong demand from American and Chinese buyers, many foreign buyers have been withdrawing money from more uncertain economies and making long-term, more secure investments instead in the capital's bricks and mortar."
Demand has also been strengthened by the growing emphasis on correct, competitive pricing. For instance, the recent sale of a unique property called 'The Organ Factory' in Holland Park. The property had been on the market intermittently since 2006, and was re-marketed for 3.45m by the vendor in 2010 with no joy. Marsh & Parsons competitively marketed the property for 2.95m prior to Christmas and having generated interest from three competing bidders, the property recently exchanged for 3.3m 12% higher than Marsh & Parsons asking price.
Rollings concludes: "The importance of sensible pricing cannot be overstated. There's no point in overvaluing a property for sale. It's counterproductive, and leaves property on the shelf collecting dust rather than interested buyers. A competitively priced property will generate far more interest, sell more rapidly and often in excess of the asking price. The growing emphasis on this tactic is generating more demand for prime properties, achieving quick, quality sales for vendors."
- ends -
For further information please contact:
The Wriglesworth Consultancy Dan Pike / Neil Mackwood T. 020 7427 1430 / 020 7427 1400
Marsh & Parsons has been part of the London property scene since 1856. The sales and lettings agent has 15 offices situated in prime positions across central, west and south London. They have an intimate and extensive knowledge of the area.
Marsh & Parsons are an independent and professional firm with a 'can-do' attitude covering all aspects of residential property. They aim to establish individual relationships with clients through a business built on energy, agility, professionalism and knowledge. Their business aim is to be the agent who not only understands the local area around their offices better than any other agent, but also to be at the heart of the community.