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Price corrections leading to an increase in buyer enquiries in London

Across London the average price of a property is back to a level last seen at the start of 2016 as price corrections lead to a rise in buyer enquiries, new research shows.

In prime central areas, prices per square foot are now comparable with five years ago while quarterly price falls are now less than 0.5% in 10 core London markets, with prices static or increasing across six.

The September 2019 market outlook report from agents Cluttons points out that a year ago, price falls exceeded 2% in 11 core London areas.

It also shows that the £1 million to £3 million market across prime central London is performing well, with an 18% increase in sales during the first half of 2019 compared to a year ago.

Buyer enquiries are on the up, with high levels of interest, but the reports warns that there is still a way to go to reach normal market levels.

However there has been a boost to the super prime market. Indeed, twice as many super prime deals of £10 million plus completed in the second quarter of 2019 compared to a year previously across prime central London. The report adds that buyer discounts for overseas purchasers have been pushed to record highs.

Demand for rental properties remains strong across the capital. A supply and demand imbalance is fostering the return to rental price growth in many markets, with prime lets at record levels.

Overall, rents across London are up by 0.9% per annum compared to a 0.2% fall at the same point a year ago.

‘Whilst Brexit is the main predator in the super prime market, for the sub-£1.5million market affordability assumes that role. Every location has a price point, and areas where the market has readjusted to such levels are bucking the London trend,’ said James Hyman, head of residential at Cluttons.

‘We are experiencing close to normal market conditions when to be marketing a property priced in line with where the true value sits. A property marketed at 20% off the highs of early 2015 will see immediate viewings, several offers and sell within a sensible time frame,’ he explained.