Fall in property sales threatens London’s status as economic powerhouse
Residential property sales across many parts of the UK will fall in the year ahead, especially in London, if demand for properties fails to pick up, the latest figures show.
Property transactions across the country and particularly in London have fallen sharply over the past 12 months or so, led by a 32% collapse in the capital, following the introduction of the 3% stamp duty surcharge on all additional property acquisitions, according to figures from the Land Registry.
The proportion of the nation’s properties which are on the market but classified as under offer, is 38% of all the properties for sale, down only slightly from 40% a year ago, according to data from property website, Zoopla.
But analysis by prop-tech company Nested shows that for expensive properties above £2m, only 10% are under offer and for properties priced between £1m and £2m, just 18% are under offer.
In central London, 18% of all properties are under offer, but for the prime market comprising of properties over £2m, just 7% are under offer, which suggests that this market is ‘almost dead’, according to Matt Robinson, CEO at Nested.
He said: “London’s position as a global powerhouse requires it to have a functional housing market to support a diverse workforce. Our analysis however shows that the number of transactions in the Capital has dropped by 32% annually, meaning that the number of homes being bought by London’s residents has dropped by almost a third.
“Combine that with the third of property transactions which fall through between offer accepted and completion and you begin to understand the scale of the problem.
“The property market in the capital is complex and fraught with difficulty so together we must find solutions which can better aid supply to match the high levels of demand and those which can also offer confidence of completion.”