It experienced ‘a very active market’ last month partly due to the wedding stirring interest and partly because there are not enough properties being put on the market to meet demand.
in the run up to the Royal Wedding last month, and it expects levels of activity and interest to It predicts that moving forward, low levels of stock coming on to the sales market will become the norm.
‘The Royal Wedding has meant that London has been in the spotlight. This, in turn, sparked a lot of interest and I expect to receive enquiries on the back of it for some time to come,’ said Simon Godson, a partner at W A Ellis.
‘It has been widely reported that there is a shortage of new properties coming on to the market, and this is resulting in increased demand. I would suggest that the current stock levels will become more typical in the future, rather than there being a short term lack of supply,’ he explained.
Lack of stock is pushing up prices, he believes. ‘The last five deals that we have agreed were all above the guide price, with an average excess of almost £90,000 being achieved. All five deals had multiple interested parties bidding against each other. Lonres, the London property transactions archive, reported that the average sale price across London has risen by 5.8% since the beginning of the year,’ said Godson.
‘We continue to experience high levels of interest from international buyers, particularly those from countries in the Middle East which are still suffering from political unrest. The ongoing relative weakness of Sterling has also meant that London is an attractive location for overseas buyers who are looking to invest,’ he added.
On the lettings market, W A Ellis' average rent has increased by 20% since last year, due to high levels of demand. ‘Because demand for properties to purchase is not currently being met, the rental market is particularly buoyant. This, coupled with low interest rates, means that landlords are becoming increasingly reluctant to sell, again resulting in fewer properties coming onto the sales market,’ said Lucy Morton, senior partner and head of lettings at W A Ellis.
‘The demand for rental properties means that void periods are now at a two year low, with the average void period currently just 2.8 weeks, compared with 3.5 weeks in the same quarter of 2010. Some 45% of our landlords now experience void periods of less than two weeks and 79% of properties are empty for less than a month. I think that this trend is set to continue as good quality rental properties in prime central London are so rarely available,’ she explained.
‘The strong lettings market is also resulting in an influx of higher value properties. The average value of rental properties in central London has increased 14.8% since last year. This is also the case nationwide, with the average value increasing by 11.6%,’ she added.
