Prices not frozen for winter
There’s no winter slowdown in prime central London prices. Estate agent Haart reports that the average London house price increased by 1.5 per cent, to £256,681, in November, for example.
In addition, first-time buyer levels remained at 26 per cent, as the market experienced unusually high activity levels.
Transaction levels were up 10 per cent in November, compared to the same period last year, as demand remained strong.
House prices in the capital rose almost nine per cent in 2006.
Paul Smith, chief executive of Haart, says: “Despite the interest rate rise, there hasn’t been a drop in buyers’ appetite to enter the market and we look set to see an increasingly ‘seasonless’ market.
“Traditionally, the summer months and the Christmas period brought calmer phases, with fewer people prioritising house- hunting, but if the high activity continues, these ‘seasons’ within the market could start to become less noticeable.
“City workers anticipating the arrival of their end-of-year bonuses boosted activity levels in the capital. The number of potential buyers registered at our branches, particularly in the prestigious areas of London, jumped considerably.
“Millions of pounds are expected to be channelled into bricks and mortar in the New Year.
“However, while these City workers may be prepared to pay above the odds for their dream home, most buyers remain price-sensitive and overpriced properties will not sell.”
According to estate agent Knight Frank, prime central London property prices grew by 2.8 per cent in November — the ninth month in which prices grew by over two per cent since the start of the year.
Annualised price growth currently stands at 26.6 per cent, the highest since June 1988.
Knight Frank agrees that, for the second year in a row, the City bonus season appears to have ended the traditional winter market slowdown.
Even before bonus money was received, its impact began to be felt on the prime central London property market.
Liam Bailey, Knight Frank’s head of residential research, comments: “The big story over the past 18 months in central London has been sharp demand growth, met with an equally sharp downturn in supply. The tight market conditions have helped push prices forward by the highest rate of growth seen for 18 years.
“The impact of demand from the City has meant that the traditional end-of-year slowdown is increasingly becoming a thing of the past in London.
“The normal sales pattern for the UK has always been that we have two market upturns – one in spring and the second in autumn, together with two market downturns, summer and winter.
“London has always been a little different – with demand from new workers starting jobs in autumn meaning the summer market can remain fairly strong.”
“Taking into consideration the time-lag between bonus announcements and payouts, bonus season lasts from December through to April, but now appears to impact the prime London market from October (as bonus levels are anticipated) until July (when most deals have been put to bed).
“Our research reveals that the number of viewings tripled between the months of December 2005 and March 2006.”
In such a strong market, would-be buyers should move fast to snap up a home at Linden Homes’ Tantarra Place, on Herkomer Road, in Bushey, Herts. Sales at the scheme have been so strong that there are only a few homes left to sell.
The 14 one- and two-bedroom apartments and three-bedroom townhouses at the development are just a short walk from shops, pubs, restaurants and open spaces, and there is also a picturesque Grade II listed rose garden adjacent to the development.
Apartments here are priced from £234,950 and houses start at £439,950.
City buyers will also be attracted to Bellway’s First Central apartment development, at Twyford Abbey Drive, in Park Royal, North-West London, on the site of the former Guinness factory.
There are two penthouses here, next to acres of green landscaped grounds, with walkways, cycle paths, tranquil lakes, waterfalls and a 20acre nature reserve.
The Aqua Building at First Central, comprising 32 apartments, has sold quickly and only the two penthouses remain, at £525,996 and £549,995.
Seven storeys up, one of the threebedroom apartments offers views of central London, the other of Wembley, and both have two underground parking bays.
Prices at the Aqua Building range from £242,995 to £336,995 and the building is due for completion in July/August 2007.
Houses at Tantarra Place, Bushey, Herts: selling fast, at prices from £439,950