House Prices Fall 2.5% in March - According to the Guardian

House prices fell 2.5% in March – according to the Guardian

The press continues to paint a gloomy outlook for property sales. The Guardian reports that house prices fell by 2.5% in March. This may be the outlook nationwide but in Central London the picture is rather brighter – at least for now.

Although we’re certainly seeing buyers behaving more cautiously, it’s misleading to talk in terms of “price crashes” and worth bearing in mid that property sales prices in many prime areas covered by Chard offices like Notting Hill, Kensington, South Kensington, Chelsea and Fulham rose by as much as 20-40% last year.

At the same time turnover is still fast - indeed the central London property market seems more fluid than in the last quarter of 2007. One trend we’re seeing is of buyers looking for property for sale in more prime Central Line areas – in particular in Holland Park, Kensington, Notting Hill and Bayswater all areas popular with corporate tenants. More than one or two buyers (many of whom are working in the city) are keeping at least half an eye open to future long term rental potential when making their decision to buy in these areas. The assumption is that should their circumstances change the property could be let. These areas are also more influenced by demand from overseas buyers.

Property sales agreed through Chard are illustrative of this trend towards buyers favoring smaller properties in established, prime areas is a one bedroom flat in Kensington Heights, Campden Hill Road in Kensington W8, asking £425,000 - the buyer is working in the City. In Holland Park W11, we’ve just agreed another sale on a flat requiring modernization asking £2M and on Portobello Road the sale of two properties priced at £1.1M and £999,000 within a week of Chard being instructed (although we understand another London estate agent was marketing them without the same success for some time beforehand)- one of which has already attracted interest from a tenant to let through our Notting Hill lettings office.

News that 100% mortgages are now virtually impossible to maintain is hardly likely to affect this market. More worrying is the uncertainty surrounding the sub – prime exposure of leading investment banks whose employees fuel the market for flats and houses for sale in prime areas of Kensington, Chelsea etc. In the meantime people are buying, but in the finest tradition of city trading are hedging against a downturn or change in personal circumstances by buying in prime, core areas.