If you’ve never seen the Coutts London Prime Property Index let me urge you to bookmark it. It comes out every quarter and the findings in this latest report, are as they say ‘eye-popping’ writes Thom Wilkinson a Partner in our Property and Environmental Law team.
According to Coutts, more homes worth £1 million or over sold in London from April to June than in any other three-month period since their records began in 2013.
The number of sales they’ve recorded (994), was over 11% higher than the previous peak in 2014, when the market was booming, and up almost 200% compared to Q2 2020. Although that’s after the market effectively shut down due to Covid.
Some of the sales hikes in specific areas are extraordinary. For example, the number of properties sold in Fulham & Earl’s Court was up 339% on the same time last year. Even if you take the pandemic out of the equation by comparing it to Q2 2019, that’s still an increase of 60%.
Their interactive map and postcode locator is particularly helpful if you’re interested in seeing the current prices that properties near you are fetching.
Whilst the Stamp Duty Land Tax holiday on the sale of residential property earlier in the year maintained the buoyancy of the prices fetched for sellers there seems little reason to expect that the trend will not continue well into 2022. We’re regularly seeing lifestyle changes sparked by the coronavirus crisis resulting in buyers looking for more room. This search for space has pushed up the average price of a residential property by 7.1% over the past year, according to Halifax.
They expect to see further house price growth in the short- to medium-term as properties of all kinds are in short supply.
However this isn’t the only trend that has been spotted. The seasons themselves have a bearing on the residential property market according to new data.
Reported in Property Industry Eye, Ben Taylor, CEO of Keller Williams UK, commented: “The stamp duty land tax holiday has spurred an incredible run of upward house price growth and despite many predicting a market slump, we’re yet to see any let up.
“Season trends suggest this could be the case for the rest of this year and much of next as the market tends to perform at its best during the autumn, winter and spring seasons.”
Keller Williams has analysed how the four seasons impact house prices and market demand over the past 36 months, a project that reveals prices are very unlikely to drop until at least June 2022.
By splitting the calendar year into seasons, it is clear that the UK housing market follows a predictable cycle. According to Keller Williams’ research the average house price in autumn – September, October, November – over the past three years was £240,000. Always a busy time of year, which the agency says goes a long way to explain why prices and demand are still so high now.
As the year moves into winter – December, January, February – the average house price climbs even further. Over the past 36 months, the average house price in winter has been £243,998.
Moving into Spring – March, April, May – prices rise again to an average of £245,000.
It is only with the arrival of summer that prices begin to decline. Over the past three years, the average house price in the summer season was £237,980, the lowest price for the whole year.
So the data suggests that having already seen a summer of hot house price growth, we should now see property values continue on their upward trend until summer 2022, at the very least.
If you would like to discuss any of the points raised in this article, please do get in contact. Thom Wilkinson is a Partner specialising in Property and Environmental Law and is contactable on: +44 (0)20 4513 6073 or twilkinson@bishopandsewell.co.uk
At Bishop & Sewell, we have more than 40 years’ experience in property with a particular focus on Landlord & Tenant. If you are thinking of buying a leasehold property, or if you already own a leasehold property and you have a question about obtaining a consent to alterations that you are planning please call 020 7631 4141 and ask for a member of the Property team, or email leasehold@bishopandsewell.co.uk.
The above is accurate as at 05 November 2021. The information above may be subject to change during these ever-changing times.
The content of this note should not be considered legal advice and each matter should be considered on a case-by-case basis.
