Sales of prime central London property leapt 70% between February and March 2011 as buyers fought to beat the stamp duty deadline, a new report reveals.
Off market sales doubled in March and April, from 4% last year to 9% this year as the number of properties available for sale in central London fell. Huge demand has caused supply to fall 49% between February and March.
It is a sign that competition in this sector of the UK’s property market is heating up, according to the latest quarterly review from Winkworth, the leading franchisor of real estate agencies.
The data for the report is gathered from a monthly survey of franchisees and should therefore be considered as indicative rather than factual.
It points out that London is currently suffering from a severe shortage of properties for sale with the total number of new instructions between January and May falling 80% compared to the same period last year.
Demand in London remains strong despite a 5% fall in the total number of registrations between January and May 2011 compared to the same period last year. This demand has caused London’s sales stock to fall by nearly a third (31%) between June 2010 and May 2011.
Rents continue to rise as demand strengthens. The report indicates that tenant numbers have grown by nearly a third, 32%, year on year in May and this has pushed average rents up further.
Greater London is driving overall rent growth. The average rent across all Winkworth properties is now £2,169 per month compared to £1,913 a year ago, an increase of 13%.
‘While financing availability for private buyers remains tight, there are some signs of improvement in the professional market with 55% more mortgage products available to property investors in the buy-to-let sector than 12 months ago. As a result, we have some hope that transaction levels will start to pick up in the second half of the year,’ said Dominic Agace, chief executive officer of Winkworth.
‘The rental market continues to be strong, with a shortage of supply creating a market that favours the landlord. This situation results from the lack of investment since 2007 and continues to underpin rental prices that have risen by over 10% in some areas of London over the last 12 to 18 months,’ he added.