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Historically the 1st quarter of the calendar year is the quietest for the UK residential property market.  However, this year we are experiencing a more spirited start to the year than any in recent history.  Not only are we seeing an increase in transaction volumes in residential sales but we are also seeing a shift in where transactions are taking place, across the value spectrum.  Last year a trend emerged for a bullish lower and mid-market and a bearish prime market.  This year however, there has been a resurgence of interest in properties at the upper end of the market place. 

The rental market has started stronger this year than any year I can remember.  Our Docklands office has recorded record transaction levels in January.  There is no shortage of prospective tenants actively seeking accommodation.  There has been no tangible increase in rental prices but such a trend would not be apparent until later in the year in any event. 

Lourdes have recently released ‘The Old Smoke House’ an architecturally designed new home scheme in Londons Royal Docks.  Where as in previous years, we have received strong demand from overseas investors for new homes stock, this year the demand is from the domestic market.  This is somewhat paradoxical considering the recent devaluation of Sterling.  The government have introduced numerous changes to taxation on investment property and second homes over the last 18 months and perhaps this swing in buying demographic is evidence that the government’s plan to dissuade property investment in the UK is achieving its goal. 

The property market in East London is likely to continue to grow stronger this year as mortgage rates remain at record lows and the infrastructure regeneration across the area continues in earnest.  Crossrail will be operational next year and this will dramatically influence the desirability of property on the East side of the Capital.  The ongoing issue of the UK breaking its ties with Europe will no doubt cause some uncertainty in the housing market and may supress sales volumes to some extent. It is however, unlikely to have a detrimental effect on prices as the economic fundamentals that under pin house prices remain strong.

So for those of us invested in the London property market the future is looking bright.  It’s been a very positive start to the year and I see no reason why it will not continue in the same vein.

27/01/17

Property Market Review

by Alasdair Carpenter

Valuation

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