Q.There has been lots of negativity surrounding house prices recently. Are prices in central London falling?
A.There has been a recent wave of negative headlines surrounding UK houses prices recently. The unexpectedly large 3 per cent drop in the Halifax house price index in September has grabbed the bulk of the headlines, though Halifax’s housing economist Martin Ellis was quick to point out the dangers of reading too much into one month’s data.
It is important for any potential buyers of London property to remember that the market in central London is very different to the market in the rest of the UK. At Black Brick we have recently participated in (and won) two sealed bid auctions on behalf of clients in prime Central London. Within prime Central London we have seen a slight increase in supply in recent weeks, but the increase provides greater choice for potential buyers and we see this as a sign of a healthy market rather than a precursor to any sharp or sustained fall in prices.
The latest figures show property prices in prime London continue to hold relatively steady, though the pace of growth has dropped markedly from the levels seen in late 2009 and earlier this year. Savills’ prime London index showed values rising 0.1 per cent in the quarter to the end of September, with the annual price inflation rate now running at 9.1 per cent.
Our view is that the stark difference between conditions in the wider UK property market and in prime Central London will remain.
Q.I’m thinking of buying a home in the country. Is now a good time to be buying?
A.Unlike London, there are far more properties on the market and far fewer buyers for country homes. Even in highly desirable locations in Surrey, Kent, and the Home Counties, we have seen a number of distressed sellers at the top end of the country house market within an hour’s travel of London.
Though we would not recommend these as investment properties given the smaller potential pool of tenants, they can often represent excellent value for those happy to live within commuting distance of London.
We recently acquired for a client a property with significant acreage and leisure facilities in picturesque Henley-on-Thames for £2.75m from a distressed seller. The house was originally marketed for £6m. This scenario is becoming increasingly commonplace.
The media has also homed in on the theme and highlighted the large discounts that sellers are being forced to accept on their original listing prices in order to get buyers interested.
At Black Brick, our view is that current market conditions in the country house market are providing excellent opportunities and value for would be buyers, but you need to hunt out where the opportunities are.
Camilla Dell is the managing partner at search and acquisition consultancy Black Brick. www.black-brick.com