We continue to see steady demand from buyers looking for London property – both from international investors and from homeowners looking to make their first property purchase or move up the property ladder. In fact, our most recent figures show that we agreed more sales in 2020 than in 2019. This is despite three lockdowns and the lack of international travel for much of the year so it is a good indicator of London’s continuing resilience as an investment location.
Of course, much of the recent increased demand for properties has been driven by the Stamp Duty holiday that has been offering significant savings to buyers. This has had a huge effect on the housing market which has bounced back beyond all expectations. Throughout this lockdown, the housing market has remained fully open for business, while we, of course, have been operating throughout within strict Covid 19 regulations.
In fact, new figures from HMRC show that 121,640 homes were sold in the UK in January, 24.1% higher than the previous year, although this figure was 2.4% lower than in December 2020. This recent slowdown is without doubt due to many buyers believing that they will now miss the Stamp Duty deadline. Rightmove has reported that 70,000 transactions could miss the deadline.
Extending the Stamp Duty holiday deadline?
To avoid a sudden drop in demand caused by the Stamp Duty deadline, Chancellor Rishi Sunak is believed to be considering extending it, possibly by another 12 weeks, so that property transactions currently in the pipeline are able to complete. This would be a huge help to buyers and sellers whose sales have been delayed by a backlog of cases being processed by solicitors and mortgage lenders due to the high volume of transactions taking place.
The Chancellor’s budget takes place on Wednesday March 3rd and this is when he will announce his decision so we may already have an answer by the time you read this blog.
The UK’s successful vaccination programme
There is another important factor in the feeling of positivity at the moment and that is the recent announcement by UK Prime Minister Boris Johnson about his plans for re-opening the country after lockdown. This is possible mainly due to the successful Covid 19 vaccination programme, which is happening much faster than originally anticipated, with all adults in the UK due to be vaccinated by the end of July.
This, we expect, will soon bring a quick return to normality and experienced investors know that this is therefore a good opportunity to expand their portfolios.
Our latest webinar shows that demand from international investors remains strong
As a result, interest in London property remains strong. We have just held our latest webinar, London Property 2021, An Unbiased View and we were delighted with the interest in the event, which was hosted by our director Marc von Grundherr, together with well-known UK property journalist Graham Norwood, who examined the current London property market and its prospects over the next few years, and also answered questions from property investors around the world.
Over 1000 property investors registered with us for the event, with 32% of these from the UK, 19% from Singapore, 21% from Malaysia, 17% from Hong Kong and 11% from the US, UAE and other regions. So this was an interesting snapshot of how international interest in London property investment is shaping up as we now start to look beyond the pandemic.
The fundamentals of investing in London property remain the same
An important conclusion that investors took away from the event was that the fundamentals that drive demand for property in London remain strong – excellent connectivity and transport such as The Elizabeth Line (Crossrail, which is due to open in 2023) and the City Airport expansion, as well as the attractions of a widely spoken language, tourism and culture and London’s position as a centre of excellence for education.
These, combined with the relative shortage of housing in relation to demand, mean that the London property market remains resilient.
The outlook for 2021
Generally, as we look beyond the immediate impact of the Stamp Duty holiday, we do expect demand for properties in London to remain steady throughout the rest of 2021 and we are not expecting price cuts or falls in the number of transactions. We expect the market to level out and a relatively static year as the economy improves gradually.
Planning your next property purchase in London
If you are planning to buy or sell a residential property in London, contact our knowledgeable sales team to find out more about our current properties or to set up a free valuation.
View all posts by Anita Mehra