Market Comment May 2010
After a particularly quiet April with the prime London market grinding to an almost complete halt with impending hung parliaments, Euro Crises and volcanic Ash, it appears that we are now seeing the dust settle and a more positive and easier attitude to the property market in central London.
Over the last month, overseas and domestic purchasers and vendors, have all held their breath whilst the results of the election and also of the economic crisis in Greece had yet to be revealed. There was a severe lack of new stock coming to the market and overseas clients chose to hold out until they could see where sterling would establish itself. We are now already feeling a sense of relief from all sides, with overseas investors continuing to perceive the London market as having good potential growth, and also gradually more properties coming to the market as home owners seek to make a move over the summer months in order to be settled in time for Autumn.
The last quarter has also seen a stabilising of rental yields, with a general consensus across most estate agents that a gross yield of approximately 4% should be considered reasonable at this time.
Therefore we expect a busy summer market ahead, with overseas investors continuing to take advantage of the weaker sterling, and domestic buyers gradually having realised some of the equity in their properties therefore enabling them to make the onward purchase. This has been encouraged by gradually relaxing bank lending policies.
At Stacks London, we feel that more property will continue to come to the market over the next few months, therefore releasing the bottle neck which currently grips the prime central London market. However, whilst we do not see enough new stock coming to the market to satiate current demand, we do believe that prices should settle a little more with only slight rises of 2%-3%towards the end of the year.
If you would like expert and experienced help and advice during these difficult times and in order to be more confident of where and how to proceed with your purchase, please do not hesitate to contact the Stacks London office on 0207 3854101. Or London@stacks.co.uk
