London property update - are good homes becoming as rare as gold?

It’s been a busy month at IGL – the biggest challenge has been finding quality stock for both rental and sale clients in prime central London. As soon as a good home hits the market that is well priced, the offers come flying in and it sells/rents very quickly. 

On the rental side, the market is normally driven by foreign university students and families relocating to London. Due to travel restrictions, both groups of tenants are not coming, causing prices to drop to as low as 20% in some areas. Many landlords are holding off putting their flats on the market or are extending their contracts with their current tenants at discounted rates, causing supply levels of quality homes to be very low. There are signs of the rental market strengthening, however supply hasn’t been able to keep up with the demand.

It’s a similar issue for the sales side – prime central London is driven by foreign demand and due to the travel restrictions, this is also lacking. In areas such as Knightsbridge, Belgravia and Mayfair where the domestic market is weak, homeowners are holding off putting their home on the market until international buyers return. Even in areas where the demand from the domestic market is very strong (St. Johns Wood, Chiswick, Richmond), supply is very low – although for very different reasons. Domestic buyers are now prioritising outside space and larger homes rather than a central location, creating a very competitive market for homes within this segment. 

This is why working with a property buying consultant is key to securing the best possible property, as you get access to off-market properties as well as pre-launch properties. A buying agent is also well connected, helping you make sure you are one of the early buyers/tenants in the door. 

Against this background of a lack of stock, house prices in general grew by 1.8% in June, putting the annual UK house price growth at 10.9%. In addition to the lack of quality stock, the increase in house pricing is partially also due to the rush to beat the stamp duty deadline on the 30th of June. Buyers saved £12,000 on the first £500,000 and £15,000 on the first £1,000,000. This drove a lot of activity on the lower end of the market. In prime central London, the savings were welcomed but ultimately didn’t have a large impact. Some industry professionals argue that there might be a short plateau in home prices on the more affordable side of the market, however Savills are predicting a four percent growth of 2021 and a five percent growth in 2022. 

Property of the moment

I’m very excited to introduce “property of the moment” – a weekly feature at the end of every blog post where I present a great property that is either on or off market. As someone who knows almost all of the best homes currently for sale in prime central London, consider property of the moment as a weekly selection of the finest homes on the market. 

I’ll give the core details of the property (size/location/price) and if it sounds like it will be of interest to you, please get in touch to discuss further. 

South Kensington flat with direct access to communal gardens 

£1,950,000 

1,281 square feet/119 square meters 

A fantastic two-bedroom flat on the raised ground and first floor with direct access to communal gardens, something which has been very much in demand since the start of the pandemic. The flat is a part of a former late Victorian townhouse, so benefits from the grandest proportions of the building. It benefits from its on private entrance and a share of the freehold. 

Get in touch here.