Property Market Update - September 2020

While renewed social distancing measures are affecting other areas of our lives, property transactions are still able to go ahead, essentially as before. And working from home is still affecting our property preferences, as the London market shifts to high levels of activity in Outer London. We take a look at what these trends mean for you, as well as the Prime Central market, overseas buyers and commercial investors in this month’s Property Market Update.

Large homes are a must-have for buyers

The national trend towards larger homes, motivated by buyers spending more time indoors, has not yet slowed, with sales agreed remaining high. For top of the ladder homes – 4 bed detached and larger – sales agreed were up 104% on this time last year. The demand for more space has meant these larger homes are seeing a record price rise – now is the perfect time to act quickly if you’re considering selling.

Outer London has one of the fastest turnaround times nationally

In London, the market is complex – with sales agreed on average down by 3%. A closer look shows us that the Outer London market is still very active, with the average time to sell at 49 days. This is 20 days shorter than this time last year – there are a lot of buyers ready to relocate to Outer London where larger properties are available at lower prices. This quick turnaround time does indicate a need to be prepared, so that your dream home or perfect offer doesn’t slip from your fingers. Have a look at our Sale Ready advice here for tips on streamlining your transaction.

Source: Rightmove

Prime Central trends – act quickly to capitalise on changes to the law

In Zone 1, sales have slowed by around 14% for the year. Forecasts had anticipated that lifting international travel restrictions would boost prime London markets in areas popular with overseas buyers. Uncertainty over incoming restrictions will perhaps impact this area of the market slightly, but in general buyers in higher value markets will be protected from the worst of the economic challenges ahead.

If you’re an overseas buyer looking to purchase in the UK, a 2% stamp duty surcharge will be introduced next April – many buyers are starting to act on this now, as turnaround can take longer and prices are currently lower than average. It’s a crucial time to buy, and a well-prepared, responsive lawyer is a must for the PCL market.

London office space affected by the second wave?

Despite travel restrictions, European investors accounted for over 50% of the transactional volume this month for Commercial Investments in London. While there has been a drop in transactional volume in commercial property – due in small part to the annual summer break – pricing has remained strong. Savills’ prime City yield is at 4%, and prime West End at 3.75%.

The Commercial market is being tested by the rapidly changing advice on who should be working in the City and who shouldn’t, but historically the market has always bounced back from economic setbacks. At times like these, an experienced team around you is needed to help navigate the market.