The transaction volumes of properties in Prime Central London, one of the top real estate markets of the world, is improving following growing demand.
The number of residential exchanges was 5 per cent higher in the first seven months of 2017 compared to the same period in 2016, according to Prime Central London Sales Index – August 2017, released by real estate advisor Knight Frank.
While there has been a modest decline in sales volumes since April due to political uncertainty surrounding the general election and Brexit talks, volumes were 21 per cent higher in June and July compared to 2016. This reflects the underlying trend of a market that has stabilised in 2017, though it is worth noting that the process has not taken place in a uniform way across all markets and buyer sensitivity to price remains high.
An analysis of growth by price band reveals that higher-value properties outperformed lower-value properties for the sixth consecutive month as the market adapts to higher rates of stamp duty.
Furthermore, Knight Frank demand indicators reveal an improvement in forward looking data, with an 8 per cent rise in the number of new prospective buyers registering between January and August 2017 compared to the same period last year. Viewing levels were up by 14 per cent over the same period.
The supply of new stock over the first eight months of the year was 17 per cent lower than 2016. The decline is largely the result of a surge last year caused by a stamp duty hike in April 2016. The overall level of stock was 9 per cent higher at the end of August than the same point last year.
The impact of political events and stamp duty changes means a comparison of market performance in 2017 with previous years is not straightforward. However, an improvement on last year is clearly discernible although any recovery remains relatively shallow for now and in line with our forecast for a broadly flat price movement this year - Knight Frank