Sanctions on bankers bonuses has sparked fears of expat departure
Good news regarding lettings agent regulation
Sales:
Richard Barber, partner in residential sales at W.A.Ellis, comments:
"February has been dominated by various announcements calling for a mansion tax on homes valued in excess of £2m to fund a revival of the 10p starter rate of tax. There is no real plausible economic justification for such a move. Not only would it be costly to administer given the potential for valuation disputes, but it would also be unfair on 'asset rich, cash poor' homeowners.
In spite of this, the upper end of the sales market has seen a remarkable resurgence in activity. We have received some exceptional new instructions, including a penthouse in Upper Belgrave Street for £7,250,000, and another in Belgravia Mansions for £5,750,000. Other notable examples of activity in our market include an exchange of contracts on a house in Clabon Mews for £5,250,000, and a substantial family house in South Kensington which went under offer close to the guide price of £5,000,000. As well as an increase in instructions, sales transactions have risen by 11% from January to February in our core market.
As we head into spring, we are now faced with the loss of our AAA rating. This, along with the threat of a mansion tax, may lead some foreign investors to look cautiously at the prime central London market; however, we believe that these factors are more than outweighed by the current weakness of Sterling against both the Dollar and the Euro."
Lettings:
Lucy Morton, senior partner and head of lettings at Prime Central London estate agency, W.A.Ellis, comments:
"In comparison to January where enquiry levels in the lettings market rose by 100%, the school half term holidays have had a noticeable effect, with levels dropping back to their normal average for this for this time of year. This doesn't necessarily indicate that the market has slowed down, but there isn't the same frenzy of activity we witnessed at the start of the year.
The European Parliament recently sanctioned that bankers' bonuses across Europe cannot exceed their basic salary, prompting some concern in the lettings market. Although housing allowances are almost always kept separate from bonuses, these blue chip tenants do tend to drive the top of the market in prime central London, and this announcement has sparked fears of a departure of expats from London to other financial capitals.
On a positive note, we're delighted to hear the news that the House of Lords has voted in favour of regulating the lettings industry - I have for many years been advocating the regulation of lettings agents and worked with Baroness Hayter on the Property Standards Board. It never ceases to amaze me that the Government will not regulate our industry and therefore improve standards, professionalism and put a stop to the rogues. At the very least, all agents should have Client money protection, professional indemnity insurance and sign up to a redress scheme."
