Press Release: Surge in Property Millionaires While Price Growth Slows in Prime London
Tue 30 Oct 2012
- 43% of homes in the prime areas of London are now worth 1m, up from 34.6% a year ago*
- Price growth has slowed on a quarterly basis, falling to 3.5% in Q3
The proportion of properties worth 1m in prime London has risen by over 8% in the last year, according to estate agent Marsh & Parsons latest London Prime Market Monitor.
Just over one third of properties across the prime areas of London were worth 1m or more in September 2011 (34.6%), a figure that had risen to two in five (43%) following average annual price growth of 11.1% in the last quarter.Properties worth more than 1m are no longer confined to locations in prime central London. In September 2010, 57.1% of 1m properties were located in the traditional prime central locations such as Chelsea and Kensington, a figure that has fallen to 52.7% as areas to the south and west of more traditional prime central hotspots see strong price growth.
However the strong price growth in the past two years has also boosted the number of homes worth 2m in prime London. 18.5% of all homes in prime London are worth 2m or more, compared to 14.3% a year ago, while 35.5% of homes in prime central London are now worth 2m or more.
Peter Rollings, CEO of Marsh & Parsons, comments: After the meteoric price rises seen in prime London in the past few years, the number of property millionaires in the capital has also shot up. Properties no longer have to be palatial to be worth 1m. If they are located in a popular prime area, theres a good chance theyll be worth a seven figure sum. They do not necessarily have to be mansions.
International and domestic buyers have been flocking to prime property in recent years, but this influx of wealth is no longer concentrated in the most central locations. With the supply of homes especially constrained in the central prime areas, wealth has been overflowing into areas like Balham, Clapham and Brook Green, pushing up prices and boosting the number of 1m properties across the capital.
What 1m will buy
Despite the rise in the number of million pound properties in the last year, house price rises are showing signs of slowing. In the last quarter, prices rose by 3.5%, down from 3.7% in Q2 2012, which may indicate that the price growth in the capital is moving towards a steadier, more sustainable rate of increase.
Prime London Property Price Movements
|Average Value||Quarterly Change||Annual Change|
|Prime Central London||1,885,612||2.7%||10.1%|
A healthier balance between supply and demand slowed short-term growth, with 14.7 buyer registrations per instruction in the quarter, down from 17.5 in the previous quarter. The supply of properties increased by 2% in the quarter, while the traditionally sluggish July and August months combined with the Olympics caused total buyer numbers to fall by 14.8%.
Peter Rollings adds: "Although the number of homes coming on to the market remains at near historic lows, it improved in the last quarter at the same time as buyer numbers fell back. Its not yet a buyers market, but easing competition has factored into slower quarterly price growth.
"Buyers are spending more time educating themselves on the current market and stamp duty developments, rather than acting with urgency. Properties need to tick every box not to mention be correctly priced to convince the more speculative buyers to make a move quickly."
For further detailed analysis of Londons prime market, please see Marsh & Parsons accompanying London Prime Market Monitor - available online here.
*Based on a repeat valuation of a representative basket of properties in the prime and prime central areas of London. See methodology for definition of prime London and prime central London.
The Prime Market Monitor uses a repeat valuation methodology that tracks values in a robust and representative mix-adjusted basket of properties across prime London in the areas in which Marsh & Parsons operates. Prime central London comprises representative baskets of properties covering Chelsea, Kensington, Notting Hill, Holland Park and Pimlico. Prime London comprises all areas in prime central London, and includes areas such as Clapham, Balham, Battersea, Barnes, Pimlico, Little Venice and Brook Green.
Supply and demand statistics are based on an audit of Marsh & Parsons registrations and instructions during the quarter. Buyer profile information taken from Marsh & Parsons quarterly MI data.
For further information please contact:
The Wriglesworth Consultancy - Dan Pike / Neil Mackwood 0207 427 1430 / 0207 427 1400
Marsh & Parsons, a multi-award winning estate agent, has been part of the London property scene since 1856. With 16 offices situated in prime positions across central, west and south west London, they have an intimate and extensive knowledge of the area. Marsh & Parsons services include residential sales and lettings, property management, new homes, developments & investments, professional surveying and corporate & relocation services.
Marsh & Parsons was acquired by LSL Property Services plc in November 2011, but continues to operate as a separate business, retaining its current management team.
A business that is built on energy, agility, professionalism and knowledge, Marsh & Parsons business aim is to be the agent who not only understands the local area around their offices better than any other agent, but is also at the heart of the community. They believe that Local know-how will achieve better results and make the difference for their clients.