The number of buyers looking for “Brexit bargains” in areas such as Chelsea and Marylebone has risen by as much as a third in recent weeks as claims by London estate agents.
In the sub-£1 million bracket the interest is at the most intense where stamp duty rates are lower. With this also being the case in the £3-£5 million bracket, the Chinese buyers extremely keen to invest.
According to the estate agents Savills, prices have fallen by an average of 12.5 per cent in the prime central London locations. This was since the peak in late 2014 when the former chancellor George Osborne increased stamp duty on properties over £1 million.
Since the EU referendum last June value of the pound against the dollar fall of, in turn means that the London market is now around 30 per cent cheaper for foreign buyers and as much as 50 per cent less expensive for some individual properties.
“We’ve been through a torrid time but Brexit has saved the property market at the higher end. I am delighted to say we have agreed £30 million of sales in the past two weeks. We had a run of seven sales in the £3 million to £5 million range and are now short of stock.” Said Managing director of agents Glentree International, Trevor Abrahmsohn
Buying agent Jo Eccles, of Sourcing Property, said: “The market is definitely picking up across all price brackets. We have been bidding on a family house in Knightsbridge for just under £5 million, there is competition from another buyer and the vendor has this afternoon asked to go to sealed bids.We have seen nearly 35 per cent increase in the past three weeks in the number of buying clients we are representing and a 60 per cent increase in serious enquiries from potential buying clients over the past two weeks.”
The managing partner of agent Black Brick, Camilla Dell said: “We are also seeing a return of competitive bidding across the spectrum, particularly on property that is priced correctly in line with the current market. We have also seen a return of gazumping. We recently secured a flat in Canary Wharf for a client at £1.48 million. Our initial offer of £1.44 million was accepted but we were gazumped by another buyer who offered £1.5 million. Luckily, we managed to re-agree the sale at the original asking price as our client was a cash buyer.”
Between central London and the suburbs the gap has been closing, where there have been double-digit annual rises in prices over the past two years has been another factor.
Garrington Property Finders Jonathan Hopper said “Prices in the outer boroughs will never catch those in prime London, but the boom in the ’burbs is narrowing the gap with the flagging centre — and making properties of all sizes in desirable postcodes appear better value.”
These figures can only suggest that the Help to Buy scheme is helping those who wish to get onto the property ladder.
Head of lending at Mortgage Advice Bureau, Brian Murphy stated that the findings suggest that mortgages at 90% and 95% LTV are being used responsibly through Help to Buy to give first time buyers an option that was in danger of becoming extinct.
“The Bank of England and government are coming under increasing pressure to take the heat out of sectors of the housing market, but writing off a scheme that is aiding those who most need it – predominantly first time buyers with modest levels of deposit – is not the way to go about it.
Lending standards have been carefully monitored ever since the recession, and the new mortgage rules [under the Mortgage Market Review] mean that scrutiny of borrowers’ finances remains rigorous and thorough with careful consideration given to the impact of future interest rate rises.
Providing this continues, there is a strong argument to support the availability of mortgages with far more realistic deposit requirements than has become the norm in an increasingly lop-sided housing market, especially for aspiring first-time buyers.”
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