LCP research revealed that only 2,936 transactions took place throughout 2020, with less than 60 sales taking place per week on average. Annual transactions were 42% lower than the 10-year average and were 75% below the peak of 11,660 in 1999.
Within PCL, which comprises the City of Westminster and the Royal Borough of Kensington and Chelsea, there are approximately 213,000 homes. This implies that a property in PCL would only change hands on average once in every 73 years at current transaction levels. This is now over double the average time a property in Greater London is held, at 29 years.
Andrew Weir, CEO of London Central Portfolio, comments: "PCL did not benefit from the price growth experienced by the broader UK housing market during the pandemic. The low transaction volumes demonstrate that real estate in this market is ‘tightly held’ and properties are not listed for sale during times of price suppression, which effectively creates a bottom line for property prices. Sellers have been reluctant to place their property on the open market due to a lack of international investors resulting in volumes falling beyond the previous low levels witnessed in the immediate aftermath of the GFC and the years following the EU referendum.
The latest data also suggests that the stamp duty holiday has had a limited impact on the PCL market and has been more of a ‘nice-to-have’ than a driving factor.
Weir concludes: "With the easing of lockdown restrictions and a successful vaccine roll-out, we expect to see the return of some Londoners who look to re-establish their city life. The current lack of overseas buyers presents a short window of opportunity for the domestic market."
