Trouble in paradise? Market for top end London property is cooling down
PUBLISHED: 14:53 18 February 2015 | UPDATED: 16:10 19 February 2015
Demand for prime homes in some of London’s most sought after areas has slumped according to new sales data, prompting industry experts to question whether the market for luxury homes is set to cool even further in the first half of 2015.
New data released by online estate agents eMoov.co.uk show that average demand for properties priced above £2 million across the capital’s most prestigious postcodes dropped to 11.2 per cent in 2014, with Marylebone (6.4 per cent), Primrose Hill (6.5 per cent) and Maida Vale (6.7 per cent) seeing some of the worst listings to sales ratios.
The data shows a particular slowdown in the market for properties in Zones 1 and 2, with eMoov.co.uk’s CEO Russell Quirk saying the prime end of the market has “been devastated”.
He said: “For a while now certain areas have seemed impervious to changes in the property market elsewhere in the country. However it is apparent that this is no longer the case as the capital has been brought to its knees.”
But whilst estate agents in some of the worst-hit areas have seen a slow down in the number of prime properties going to new owners since 2014, they remain positive that demand will pick up after a period of uncertainty surrounding a potential ‘Mansion Tax’ should Labour win May’s general election.
Philip Green, director of Goldschmidt and Howland Estate Agents in Hampstead said: “With a general election expected in May, many people at this end of the market from £2m to over £20m are wary of buying turkeys before christmas. While there has been a slowdown in purchases there has been an increase in the rental market for these properties with people waiting with a view to see what happens.”
Increases to stamp duty announced in December have also had an impact on demand for prime properties, with Marc Schneiderman, director at Arlington Residential in St.John’s Wood confirming there has been an “atmosphere of unease” from buyers who now face paying stamp duty of £1.1 million on a home worth £10 million.
“Despite the fact that stock at this end of the market is limited, demand is entering negative space because people remain hesitant,” he said.