Annual price growth in prime central London was 7.5% for the third consecutive month in April, a figure that has changed little over the last year. Meanwhile, the number of consecutive monthly price rises reached 42.
With a general election scheduled for 7th of May next year, such consistency is unlikely to be repeated over the next 12 months.
Uncertainty is likely to intensify as the prospect of an election comes into sharper focus after the summer. Activity typically slows in the run-up to a general election and this is likely to dampen price growth in prime central London.
Tax changes over recent years, which have been implemented or which are due for introduction – appear to have been priced in to some extent. However the prolonged period of consistent growth suggests the market is waiting for clarity from the political parties on their policies and their likely impact in central London.
Ahead of a rise in political campaigning in the autumn, more owners have started to explore a sale which, alongside the usual post-Easter seasonal rise, means more stock is likely to come to the market over the next few months.
Annual growth across prime central London of 7.5% compares to 11.4% two years ago and is largely being driven by the strength of the sub-£2 million market, where prices have risen about 13%. That compares to 6.3% for homes worth between £2 million and £5 million as growth slows in the higher price brackets where increases were stronger in the immediate aftermath of the financial crisis.
The Marylebone and City & Fringe districts registered the joint highest annual growth of 15.7% as buyers sought better value to the north of Hyde Park and further east. Monthly growth across prime central London was 0.8% in April, the highest rate since March 2013.
Tom Bill, associate, Knight Frank Residential Research thinks that with a general election scheduled for 7th of May next year, such consistency is unlikely to be repeated over the next 12 months. Uncertainty is likely to intensify as the prospect of an election comes into sharper focus after the summer.
"Activity typically slows in the run-up to a general election and this is likely to dampen price growth in prime central London.
Tax changes over recent years, which have been implemented or which are due for introduction, appear to have been priced in to some extent. However the prolonged period of consistent growth suggests the market is waiting for clarity from the political parties on their policies and their likely impact in central London.
Ahead of a rise in political campaigning in the autumn, more owners have started to explore a sale which, alongside the usual post-Easter seasonal rise, means more stock is likely to come to the market over the next few months.”
