Property sales at the top of London’s property market increased strongly in 2018
The top end of the residential property market in London saw remarkably robust levels of sales last year despite Brexit concerns, particularly for homes above £15 million, a new analysis shows.
In the £15 million plus sector sales increased by 43% year on year to a total value of £2 billion in 2018 compared with £1.4 billion in the previous year. Above £15 million prices have fallen by 22.6%.
Overall there was a total of £4 billion sales in 2018 in the £5 million plus sector of the market, a rise of 10% year on year, according to the latest market intelligence report.
But prices are still down, with the analysis showing that values are down by 19.4% since their peak in 2014. But it adds that this makes the super prime property market attractive to overseas buyers, particularly non-sterling buyers.
Despite the backdrop of political uncertainty and a less welcoming tax environment, these figures are clear evidence that London remains an attractive place for a growing pool of international high net worth individuals to live and conduct business.
Office take up in central London reaches highest level since 2014
Central London office take-up for the whole of 2018 reached 14.61 million square feet, some 14% higher than the long term average and the highest level since 2014, new research shows.
Overall Central London office take-up in 2018 was more than 5% higher than the previous year which stood at 13.84 million square feet, according to the latest report.
It also shows that whilst take-up for the fourth quarter of 2018 totalled 3.82 million square feet, slightly surpassing the previous quarter of 3.74 million square feet.
The increase in total take-up comes as 2018 saw more deals over 50,000 square feet at 48 than in the previous 12 months with the fourth quarter seeing 15 deals.
Technology, Media and Telecommunications (TMT) was the most dominant sector taking space during 2018, accounting for 27% of all take-up, followed by finance with 19%.
This means that it is business as usual in the Central London office market, despite the fears that companies would put decision making on hold until after the conclusion surrounding Brexit.
Prices continue to fall across London’s prime property markets
Property prices in London’s prime property market are continuing to fall but the number of new buyers registering in the market is rising, the latest monthly analysis report shows.
Overall prices are down by 4% in the central London market year on year and down by 4.8% in the outer London market, according to the prime London sales index report.
On a quarterly basis they are down by 1.7% in central London and by 1.6% in outer London, while month on month they are down 0.5% and 0.7% respectively in November compared with October.
But the report points out that the number of new prospective buyers registering in prime central London rose 7% in the year to October year on year, however sales over the same period were down by 12%.
Prime London housing market showing increased transaction volumes
As highlighted by the Financial Times on the 20th of February 2017:
“House price cuts and the fall in the value of the pound are breathing life back into the prime London property market, with the number of homes under offer at its highest since before the EU referendum.
After slumping in 2016 to levels less than half of those the previous year, the number of offers in prime districts such as Chelsea and Belgravia rose in January to just 4.5 per cent below the level a year ago, according to LonRes, a data firm.
“This is one indicator of the market over the next few months,” said Marcus Dixon, head of research at LonRes. “People who are serious about selling have realised they need to be more competitive with their pricing, and to entertain lower offers. “There is also the currency play, particularly at the upper end. Sterling has fallen by 16 per cent since the Brexit vote on June 23. Combining these factors could lead to a total discount of 30 to 40 per cent for buyers compared with the top of the market”, said Mr Dixon.””[Source: Financial Times]
London property market sees substantial rise in prospective buyers
There has been a 22.1% rise in the number of new prospective buyers in the prime property market in central London since the European Union Referendum compared to the same period in 2015, according to a new report.
The number of properties under offer in the eight weeks since the Brexit Referendum rose 19% compared to last year’s web viewings grew by 20.8% while viewings increased by 49%.
The report shows that buyers in overseas currencies are benefiting from an effective discount of more than 10% since the start of the year due to the depreciation of Sterling. Meanwhile, the Brexit Referendum has been the trigger for some vendors to reduce asking prices to levels that take higher rates of stamp duty and the new economic and political climate into consideration. LINK
London prime rental market reviving post Brexit Referendum
The number of new rental properties placed on the prime property market in central London the three months to July increased by almost 40% as rents fell by 4.1%, according to the latest index.
The number of new prospective tenants also increased, up by 7.2%, while the number of tenancies agreed increased by a fifth and average gross prime yields were flat at 3.1%
August was a strong month in the super prime £5,000 plus per week market, with deal volumes up on the same month last year. LINK
London residential rental market strong, new reports suggest
The London rental market has bounced back to see rental values rise by more than 4% across most of central and east London with healthy gains seen across most of the rest of the city.
The prime central London market saw strong gains last quarter after several quarters of stagnation, and continued to see strong growth this quarter, the data also shows.
Many of the tenants are overseas professionals who are opting to rent long term […]. LINK[Source: Propertywire]
Cushman & Wakefield – “Winning in Growth Cities 2015-2016″ Report
Cushman & Wakefield, a commercial real estate services firm headquartered in New York, in its recent ”Winning in Growth Cities 2015-2016” Report confirmed London as one of the most interesting real estate markets in the world.
According to the Report, London is the Top City in the World for (i) Global Investors/Foreign Buyers and (ii) Office Investments. With reference to the former, London “was the most favoured market with a near 16% share of trading making it almost equal to the next 4 markets combined” (New York, Paris, Sidney and Tokio) LINK
Wealthy Chinese looking to invest more in London prime property
Chinese investors, particularly those from the mainland are set to become the biggest group of investors in London with a relaxation of the amount of money that can be moved overseas due to be implemented soon, it is claimed.
The changes in the stock market may also play a key role as wealthy Chinese investors turn away from their domestic market to explore new investment opportunities overseas […].
Typically Chinese spend up to £2 million on a new off plan development in London, however […] this will change with buyers from China looking at investing from £2 million to £50 million in real estate […].
One of the primary motivators for Chinese property investment in London will be education as increasing numbers of Chinese parents are choosing British educations for their children. London’s culture, retail and lifestyle will also be key contributors to increased investment in London property. LINK[Source: Propertywire]
London is top spot for wealthy real estate buyers, report suggests
Demand for luxury homes in the Europe, Middle East and Africa region is strong as ultra wealthy individuals are buying around the world to further diversify their holdings […].
The UHNW Residential Real Estate index tracked by Wealth-X hit a new record high of 112.1 in the first quarter of 2015, up nearly 4% from the fourth quarter of 2014, and 7% from the first quarter of 2014.
London remains the top real estate hub for the EMEA region. The city’s price per square foot at US$3,103 is nearly four times that of Dubai, six and nine times more than Madrid and Cape Town respectively.
The report says that a third of all premium London properties for sale, that is homes valued above US$1 million, are worth more than US$10 million. By comparison, Dubai has only 8% of its luxury properties listed in the super prime range above US$10 million […].
‘Luxury residential real estate encapsulates a core part of the identity of the super-rich. As their wealth continues to grow, so will their investment fueled by flight to safety from less geopolitically stable geographies,’ said Wealth-X president David Friedman. LINK[Source: Propertywire]