Spring property update

We’re already at the end of March and it’s been an interesting start to the year….A bit like the weather - some sunny upbeat days, but generally rather damp and disappointing!

It's been a relatively slow start to the year and while we started with a great deal of optimism, the mood has slightly dissipated with the Easter break coming relatively early this year and the spectre of an election looming.

Whilst asking prices for prime properties have generally sagged slightly, some agents continue to over-egg their potential value, and sellers are clinging to the hope of that record sale price.

What is evident in this insecure market, more so than ever, is that where you set your asking price is indicative of how long you will be on the market...

Stating the obvious: if you price it correctly, you have a far better chance of engaging a buyer quickly, and if you push the price up, you will most likely have to wait a while to secure a sale while other more reasonably priced properties sell.

But sometimes the market seems to have no logic at all!

We received instruction on a fabulous property in Kensington in February and within a matter of weeks had exchanged contracts over the asking price with multiple interest over £10 million.

Yet, on the flip-side, we have what we believe is a an extremely well-priced, best in class house in Chelsea, that ticks all the boxes but after 50+ viewings, we still have not found a buyer.

One thing we never do however, is give up, and we are meeting the client to look at various ways to reinvigorate the marketing. We will get there, but as the sellers are now realising, it will take longer to get to their end destination.

In terms of the recent budget, the biggest takeout was the change to tax for the non-domestic buyers, which is likely to affect the prime central London property market in particular.

Non domestic arrivals will not pay tax for the first 4 years, but will pay the same tax thereafter. We have seen several buyers change tack and pause their search, while they look into possible alternatives in Europe.

As an industry, we were expecting these laws to change which was something many of our foreign clients had anticipated.

London is not just a place of investment but also as a place to live due to stability, culture, education and hub between East and West. There will be some casualties but as we have found on many occasions, when one door closes another opens and if you want something enough, you're going do it regardless, so we don't really anticipate a huge decline in foreign investment.

The higher rate of Capital Gains Tax is not really something that will affect our PCL clientele, and if some landlords choose to exit the Property Redress Scheme (PRS) as a result, while not being good for rentals, this could fast track a few more great properties onto the sales market. Like any market, there will be some fall-out, but the PCL market will always find a way to bounce back or find a way around obstacles!

As far as the election is concerned, we are not that worried about a possible change in government, as let's face it, the current government has not done much for us over the past few years! So things are unlikely to change much, but as the saying goes 'a change is as good as a rest' and we look forward to entering Q2 2024 with a new spring in our step!

Happy Easter!