Homes sold for £2m or more in prime areas of London over the last three months have seen prices rise 3.2 per cent from the same period a year ago, according to data from property group Lonres.
However, homes sold for under £2m saw prices fall by 5.8 per cent, compared to the first quarter of 2017.
This reflects a reversal in fortunes for these two segments of the market: two years ago homes sold at £2m or more recorded annual falls of 5.5 per cent ,compared with growth of 4.4 per cent for those priced under £2m.
Marcus Dixon, head of research at Lonres said:
“Homes sold below £2m, recorded the most significant prices falls, as the wider London housing market slowed and fewer investors entered the market.
“This contrasts with the market above £2m. Demand for these properties appears to be increasing, prices having fallen earlier and buyers, many of whom are owner-occupiers, have begun to see value, even with Brexit uncertainty still looming.”
According to Becky Fatemi, managing director of London real estate agency Rokstone, the increase in prime real estate prices comes down to continuing high demand in London’s luxury areas.
“Mayfair and Marylebone is where everyone wants to be, so prices are going to be stronger,” said Fatemi. “I had 16 properties in the W2 postcode last year, now I’ve got two.”
Peter Wetherell, who runs Mayfair-based agency Wetherell, has seen a similar increase in demand for high-end properties, and as a result, prices in the area have remained strong.
“Mayfair has bucked the trend,” says Wetherell. “Whereas everyone else has plateaued, we’ve kept growing. We’ve taken the crown back from Knightsbridge.”
Still, overall prices across prime London fell by an average of three per cent compared to the same period last year, even though the number of transactions increased by three per cent, with the market for homes over £2m continuing to see the most activity.
According to Wetherell, this overall slump in the prime London market is due to a large extent to the government’s stamp duty, which has dampened the market beyond even their own expectations.
“They’ve done what they wanted to do, they’ve taken the heat off,” said Wetherell. “The problem is they turned on the cold water tap too strong.”
Meanwhile, according to the Halifax House Price Index released today, prices across the UK have fallen by 3.2 per cent in the first three months of the year.
Source: City A.M.