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18th September 2015
With the soaring prices of recent years settling down the Sunday Times considers the outlook for London’s property market. "The capital's housing market is the most stable it's been for years," says Julian Peak of Kinleigh Folkard & Hayward. "In the past, there has been a boom-and-bust trend of price surges as buyers flood the market, then corrections as demand subsides. But 2015 has been different." London estate agents described the first day after the Conservatives’ election win as "bonkers", "like a whirling dervish" and "the centre of a hurricane" - there has been "steady and sustained activity", as Mr Peak puts it. Charlie Bubear, head of Savills in Chelsea, says that one of the reasons for this is a "delayed reaction" to December's stamp-duty changes. This evened out the expected post-poll bounce. Last year, for example, you would have had to spend more than £7.14m on a home to be landed with a £500,000 stamp-duty bill; now that sum applies to properties over £4.89m. According to Richard Barber, director at WA Ellis, across London as a whole, the number of properties sold for more than £1m fell by 26% year-on-year. This could be good news for buyers, signalling a return to normality in the market," he says. Below the £1m mark, lower stamp duty and the BoE’s signal that interest rates won't rise until 2016 have given a modest boost to buyers. However, Adam Challis, head of residential research at JLL, cites improving economic and employment prospects as "a far more important factor supporting demand". He expects average prices to increase by 4%-5% by Christmas, compared with 3%-4% in prime London.