June Newsletter

How is the property market?

As we entered 2023, we were faced with drastic forecasts of a property price crash this year. The market has proven to be resilient, so the drastic forecasts never came to light. There are however, two markets that are performing very differently. The £5 million plus market is seeing strong levels of activity, with high-net-worth buyers from around the world taking advantage of the weaker pound. The market up to £5 million is slower however, as there is a decrease in activity as buyers are more affected by the higher mortgage rates.

Reality Vs Predictions

As we headed into the new year, there was certainly a sense of doom and gloom. According to Savills, London prices as a whole would drop 12.5% while prime central London would drop 2.5% and 7% for outer prime central London. So far, the data hasn’t supported this forecast. Halifax reported that in the year to March, prices fell by just 0.9%. Rightmove has published research stating that prices have increased in certain areas – average asking prices were up 2.8% in April. According to the research, the bulk of the price growth was in PCL. This is why working with a buying advisor is key – PCL is made up of pockets of the best streets, buildings and homes. A buying agent will ensure you get access to these homes which should also prove to be more resilient in turbulent times.  

Market performance by price level 

£5 million and below

While the PCL market is holding up much better than predicted, the £5 million and below market is seeing decreased levels of activity. In comparison to April 2022, April 2023 saw a 34.7% decrease in sales activity. When comparing year to date, sales are down 24%. From my own searches I am finding that this market is much more price sensitive – homes that are not priced correctly are not selling and ultimately end up being reduced in price. It’s a good time to be a cash buyer in the segment, as there is less competition, and you will be able to offer the seller deal certainty

£5 million and above 

The last few months have proven to be very strong for this segment of the market. In comparison to last year, sales are up by 26%. When comparing the average sales between 2017 and 2019, agreed sales are more than 50% higher this year. Naturally, buyers at this price level are less affected by the cost-of-living crisis and are less reliant on mortgages. London has historically been a safe haven for high-net-worth buyers to invest in property and we are still seeing this today.

It’s worth noting that in both segments of the market, there is very little good quality stock available. When a good property comes on and is priced well, it tends to sell very quickly. This is why I always try to ensure I get early access to properties, whether that’s on or off the market. I’m also ensuring that my buyers are ready to go with financing and retained solicitors, so there is less risk for losing out on the deal.