Prime London property sales picking up in Q2 of 2015

Prime London property sales picking up in Q2 of 2015

The number of sales in the prime property market across London may still be far behind the boom period experienced a year ago, but the second quarter of 2015 has seen a significant rise in purchase volumes when compared to the start of this year. 

In quarter one, there were many concerns among people in the UK prime markets that the election result in May could have a significant impact on the value of properties, with proposals such as Labour's mansion tax seen as potentially problematic. However, the victory in the May election for the Conservative Party has meant confidence returned in quarter two. 

JLL said that sales are still some 32 per cent lower than they were a year ago, when the prime market was booming. However, they still sit at a full 21 per cent higher than they were at the end of quarter one, a three-month period dominated by uncertainty. 

Curiously, even though sales are markedly higher than three months ago, quarter two prime average property prices are 0.6 per cent lower than they were in quarter one. 

However, in spite of this, JLL said that the current figures show that the market has a real resilience moving forward, and that the demand for quality prime homes should mean a rise in prices is evidenced in the rest of the year and even further into the future.

"While transaction levels remain low, particularly in the £3 million to £7 million sector of the prime central London market, there is undoubtedly a noticeable flight to quality," said Richard Barber, sales director at W.A.Ellis, part of the JLL Group.

"Affordability issues, in the face of increased stamp duty costs, have affected purchaser confidence, but high prices per square foot are still being achieved for the most exclusive properties," he continued. 

As well as there being a rise in the number of sales at the moment in the prime London market, JLL also said there has been a significant increase in demand for lettings in this area. In the second quarter of the year, lettings activity in prime property was up by four per cent when compared to quarter one, a reality which pushed the price of renting in this sector up by 1.5 per cent in the same period.