Taylor Scott International News
Price growth in London’s prime residential markets has continued to slow over the past three months as buyers are in less of a rush, new research suggests. Caution first seen in the central London markets early in 2014 has spread to markets in other more domestic prime London locations, according to latest analysis from international real estate adviser Savills. At the same time, the prime regional and country house markets lost some of the momentum seen in the first half of the year and values in both prime London and prime regional markets grew by an average of just 0.5% in the quarter with gains in some parts of the market being offset by modest price falls elsewhere. ‘Despite an improving domestic economy, the effect of the higher rates of stamp duty introduced in 2012 is still being felt particularly around the £2 million mark and was compounded over the summer months by the Scottish referendum and ongoing discussions around a mansion tax,’ said Lucian Cook, Savills UK head of residential research. The continued slowdown in growth means that annual price growth in the prime markets of Chelsea, Belgravia and Knightsbridge averages just 3.3% having flat lined in the last three months. By contrast, slightly less expensive central London markets such as Notting Hill and Kensington have shown quarterly price growth slightly in excess of 1% in the quarter, taking year on year growth to 10%. Elsewhere in London, prices were all but static in the prime markets of south west London, a band that runs from Fulham to Richmond and Wimbledon and south through Wandsworth, as prices rose by just 0.1% in the quarter. ‘These affluent domestic markets were the star performers of 2013, with 14% growth, but now look fully valued to buyers who are constrained by more stringent mortgage lending criteria and looming interest rate rises,’ said Cook. ‘Instead, it is the markets of Islington, Canary Wharf and Wapping that have proved the most resilient, having seen double digit price growth in the first nine months of this year despite a slowing in the traditionally quieter summer period,’ he added. The report also shows that beyond London other prime urban markets such as Oxford, Cambridge and Bath have benefited from a flow of London wealth with prices rising by 1.2% in the quarter and 7.6% in the past 12 months, although this has not been replicated elsewhere. The slowing in the prime markets of southwest London has slowed price growth along the wealth corridor in locations such as Cobham, Esher and Weybridge, while an entrenched price threshold around £2 million has reduced the price growth in the country house market. In the £2 million plus market beyond London prices rose by just 0.1% in the quarter, leaving annual price growth at just 3.8%. ‘In line with our forecasts, it is now becoming clear that taxation… Continue reading →
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