Up! Up! Prime Central London transactions and prices rise at last

Figures released this morning by data firm LonRes provide the latest evidence of a so-called Boris Bounce with the market improving since the General Election. 

In the fourth quarter of 2019 transactions were up 34 per cent in Prime Central London in comparison to the same quarter of the previous year. 

In one particularly stellar sector - homes priced at £5m or more - there was a 78 per cent rise on the year. 

Meanwhile prices rose 2.4 per cent in the final quarter following five successive quarters of price falls and, as an extra bonus, average discounts on properties that sell are at their lowest level for over two years.

“When the December General Election was called, there were fears that prospective buyers would put their move on hold until a result had been declared. Instead they chose to purchase and transaction volumes in Prime Central London rose 34 per cent compared with the same period a year earlier” explains Marcus Dixon, head of research at LonRes.

“This was in contrast to the previous quarter when talk of changes to top end stamp duty rates resulted in fewer sales and buyers dragged out exchanges waiting for greater clarity. In the fourth quarter stamp duty appeared to drop off the political agenda and activity increased” he continues.

“Undoubtedly there were sales in Q4 that would have ordinarily gone through in Q3, yet comparing the second half of 2019 with 2018 still shows a 19 per cent increase in sales volumes.

“Alongside an increase in transactions, fewer properties came to the market this quarter. New instructions were down two per cent on Q4 2018 and were 36 per cent lower than five years ago.

“This means there are 19 per cent fewer homes on the market now than there were a year ago. Fewer properties, with sustained levels of demand helped push up average prices which increased by 2.4 per cent in Q4 2019 compared with the last three months of 2018 - the first annual increase for six quarters” concludes Dixon.

Average discounts on initial asking prices eased again in Q4 2019, with an average of 10.5 per cent negotiated off initial asking prices.  This meant average discounts were at their lowest level for two years.