Bumper activity immediately after the election causes jubilation in the north London property market
- Credit: Archant
Friday saw a flurry of activity for north London estate agents as millions of pounds’ worth of property transactions took place before the final results were even counted.
Mansion tax threat lifted
One of the biggest election issues in north west London was Labour’s proposed mansion tax, levied on properties worth more than £2million.
Aside from a rush to exchange on high end homes before the new Stamp Duty rules came into effect in December, the market for property valued near the threshold experienced a virtual standstill after the new tax was announced, with both local and international vendors and buyers waiting to find out the result of the election before splashing out.
By early Friday morning, however, once a Conservative majority government was certain, north London agents saw buyers rushing to exchange on multi-million pound houses.
Jeremy Karpel director of TK International said: “Three exchanges happened on Friday on the back of the election results, two houses, one for just under £3.2million, the other for around £3.1million, and a flat in Belsize Park, which went for over £1million.
“Enquiries over the weekend have gone through the roof, they’re probably 20 per cent up on a month ago.”
Trevor Abrahmsohn, director of luxury estate agent Glentree said that the agency agreed about £50million of business on Friday morning as buyers and investors were eager to complete on transactions pending the outcome of the election.
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He said: “I phoned one client at 10 o’clock on Friday morning who’d been holding back on about £30million and he asked why I didn’t phone at 9 o’clock.”
Meanwhile, prime London agencies Aston Chase (12.2million), Beauchamp Estates and Kay and Co (£34million) also reported several million pounds of transactions over the weekend.
Older homeowners have also been breathing “audible sighs of relief” as they are no longer worried that they may need to sell their homes in the advent of a mansion tax, according to Nick Collins of Hadleigh Residential in Belsize Park.
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Jeremy Karpel agrees: “We had quite a few of our older clients on the phone wondering if they need to sell because of the mansion tax, so there’s a solid air of relief from my 70-80 year old clients.”
Lower end of the market
Pre-election jitters extended further than the mansion tax, however, with the entire north London property market experiencing a slowdown in the weeks leading up to May 7.
Amon Amouzandeh of HousePresso, who tend to sell property between £300,000 and £1.5million, has noticed a surge of interest since the result was announced.
He said: “There was definitely some apprehension. Fewer people were looking to buy and some were even saying that they were waiting to see until after the election.
“I’ve definitely noticed more people coming through the door since Friday and we had a couple of properties in the first time buyer market that went under offer within a week of being listed online.
“In fact one went live on Thursday night and sold at the weekend for its full asking price. I wouldn’t have expected it to go quite that quickly.
“If it’s a sign of things to come then the market might be getting more buoyant.”
Will prices go up?
Agents across north London are seeing demand for property surge, but new stock has not yet been added to the market at anything like a similar volume.
This is compounded by a lack of new building, which saw only 200 new homes built in Camden last year, creating a shortfall of 1,662 homes compared to the number of new households expected to need a home in the borough, according to figures from the Department for Communities and Local Government.
With the appetite for property now on the increase again but supply remaining sluggish, it seems there’s only one way for property prices to go – up.
Jeremey Karpel: “People are making offers on properties we showed weeks ago because they’re worried that asking prices may go up now. And I have had vendors calling me since the election saying they’re thinking of putting their asking prices up.
“All factors suggest that the market will progress in an aggressive way,” says Karpel. “We got a huge number of families buying in area because of the schools but there’s been very low supply. I think this year we might see people forgoing a summer holiday and house hunting in July and August instead.
“There’s a lot of pent up interest. We may end up doing 12 months of business in six months.”
Collins offers a note of wait and see caution but has also seen vendors angling for price increases since Friday.
“A lot of the market’s a feel good thing,” he says. “People are already thinking that the value of their property’s increased.
“I’ve had one client already wanting to put his asking price up now that the results are in.”
One note of caution though from Tim Vallance, head of retail and leisure at JLL, who provide commercial and residential property services in the UK. In a tweet yesterday he advised: “Estate agents and home owners would be wise not to gloat. #MansionTax is inevitable and has merely been delayed - in my opinion.”