Reports of central London bottoming out.
Several research reports released earlier this month suggested that the central London residential property market has reached the bottom. Comparisons were drawn from the GFC (Global Financial Crisis) in regards to the percentage drop in market values from the peak and the timescales involved. This theory matches with what we have witnessed, both developers and the few vendors that are in need of a quick sale have become adequately realistic with prices and that has meant units are now being sold at a sedate but consistent rate. The continued lack of good quality stock and the low number of desperate sellers is helping to underpin values. Most reports cite a drop of 7% from peak prices in 2014, however, many vendors may perceive bigger drops due to over-optimism on previous values rather than realistic figures.
As this is written, Boris Johnson has finally placed his cards on the table and we now await the EU’s full response to his offer. Where it will go, nobody knows. However, any resolution will result in a massive boost for the property market as we know first hand the number of buyers who are waiting on the sidelines for some form of clarity. When and if this happens, we are expecting a quick return of confidence to vendors and developers and this will translate into higher values but we do not believe this will be markedly so. This is, in part, because there also remains a large number of sellers waiting for a stronger market in which to conduct their exit.
– Jaimie Beers, Managing Director, Madley Property