The demand for luxury properties in London is not falling

On the market of elite housing in the UK there is the following tendency: buyers of real estate in England’s regional cities are more reserved than the buyers of property in London. These are the findings of new research by Savills.

At the end of last year, it was expected that in 2013 there will be a final twist on the real estate market. On the one hand, the expected reduction in activity in the market of elite real estate of London in response to the increase in Stamp duty. On the other hand, the expected reduction of the gap between London and the regions, which began to significantly increase since 2009.

However, as shown by the first six months, expectations were premature. Despite the increase in Stamp duty, prices for luxury properties in London rose in the first half of the year by 4.8%.

£2.6 billion was spent on property in London, the cost of which is more expensive than £ 5 million, 23% more than in the same period last year.

In contrast, the demand for luxury properties in regional markets of the UK property remains at a relatively low level. Over the last six months prices have risen by just 0.3% .

Meanwhile, the increase in Stamp duty for properties more expensive than £ 2 million still had its impact on the market. The total amount of transactions in the market of real estate more expensive than £ 2 million, fell by 15% between 2011 and 2012 to £16.7 per. Indeed, in the last three months on the real estate market of Central London, there is a slight price drop in some of the most expensive areas of London. In General, prices for luxury properties in Central London continue to grow, but this growth is much less than in South-West London, where prices rose more than 8.5% compared to last year. Prices in Knightsbridge are higher than their pre-crisis levels now, but prices in London showed the biggest annual growth of 13%. Price in Fulham is now about £980 per square foot. This is about half cheaper than the average price of luxury properties in Central London. The analysis shows that the high price of luxury properties is still in Knightsbridge and Belgravia – about £ 2.6 million Comparable figures in parson green, which ranked 21st in the list of the most expensive areas, on average, 1.2 million Also clearly demonstrate the high price areas such as Wandsworth, Richmond and Islington.

However, the ripple effect of prices has been sporadic and the gap between the prices for elite real estate of London and the suburbs even more. The exceptions are few. For example, Oxshottи StokeD’Abernonи CobhamFairmile where prices could rise to pre-crisis levels, on average, more than £ 1 million.

In addition to London, the very high cost of real estate in the Northern part of Oxford, where over the past five years have been registered in the Land registry 497 sales and average property price is just over £700000.

Savills has revised its forecast and now expects growth of prices for luxury properties in the UK at the level of 18.1% by the end of 2017, compared with 11.5 percent seen in November 2012, while regional variations will fluctuate from 25.1 per cent in London to 12.5% in the northeast.

® Helen Atre. 03.08.2013