July Newsletter

The results are in

The results are in – labour has won the election after the 14 years of conservative leadership. Prior to the election, the market proved to be resilient despite the uncertainty of a change in government. There were some buyers who decided to hold off until the result, so there is an expectation that the rest of the summer and autumn should be busier. This probably won’t happen until the new labour government come out with their budget, therefore there’s is a window opportunity for buyers to take advantage of a soft market. It’s also been a few months since the abolishment of the non-dom status, so this market update will also discuss how/if the market has been affected.

The London Market

According to Savills, there were 11% fewer properties coming on to market in June compared to last year. Many sellers were choosing to hold off until the outcome of the general election. Data from TwentiCi states that sales over £1 million in London were up by 5% on an annual basis in June, demonstrating the resilience in the London market despite leadership changes. Moreover, house prices in London actually increased for the first time a year in May. According to the FT, “the average house price in the capital grew 0.2% to £523,000 in the 12 months to May, up from a 3.6% contraction in the 12 months to April.”

Prime Central London Market

A few months ago, the government abolished the non-dom status. There was some concern that this would have a large negative impact on the prime central London (PCL) market, however this is yet to be seen. PCL prices have only lowered slightly; -0.4% in the three months to the end of June and by 0.9% in the past year. According to Savills, “there is little evidence to suggest we’ll see a flurry of stock coming onto the market, as many who will be affected are likely to retain their base in the capital. Also, most prime central London buyers, and indeed sellers, do not have non-dom status and demand from domestic and other international purchasers continues to be resilient, partly because of the value on offer in a historical context.”

The Rental Market

As is often the case with a soft sales market, the rental market is booming. According to Rightmove, renters are paying an average of £2,661 per month which is up 4% in comparison to last year. The demand is simply outweighing the supply, causing the increase in prices. The number of enquiries each rental property receives is now 17, which is double pre-pandemic levels. 

On the ground takeaway 

It’s been an interesting time on the ground. While the market has been relatively stable, there is a definite sense that there is very little competition and that we are in a buyer’s market. The market is extremely price sensitive now – sellers seem to be more open to taking discounts, especially if they have initially priced too high. Buyers, especially those buying in cash, are in a prime position to negotiate. Navigating this market to find windows of opportunity for the best possible home is key – working with a property advisor will ensure you buy right; the right home, in the right location, at the right price.

If you are looking for a home, please email iyad@iyadgrahne.com for a free consultation.