The ‘Mini-Markets’ of UK Property
In the UK’s biggest city everything is changing in a constant state of flux, but in a market as large as London there are fluctuations and changes inside these internal groups as well as in the market as a whole.
The property sales and rental markets are just one of these areas that can experience individual fluctuations that are unique to just themselves and specific areas. This could mean that they remain unaffected by exterior events that are modifying the market elsewhere, or it could mean that a small event has a much larger effect on this specific subset and can make market predictions even tougher than usual.
Research by Vyomm showed that while the average price for a property within the £1 million to £10 million price bracket decreased between the period of 2014-2018, the average price for the property over £10 million increased by almost 20% in those same four years. While this information could be put down to supply vs demand, it isn’t the same when you note that all price brackets, including up to £1 million, saw declines in demand.
While for the superrich market the small numbers of 100 per year mean that predicting buyer demand can be very difficult. A luxury estate agent that specialises in Mayfair property for sale has also seen a decreased in the number of transactions taking place over the past 2 years but as noted in their market reports and supporting the transactional data from the property portal, the Mayfair townhouse between £5 and £10 million has been a consistently popular option.
The lowest price bracket
In the lowest price bracket however, where there was a 16% growth in average price, there was a 20% drop in demand. Even Tim-nice-but-dim could tell you this goes against the standard model.
With property prices in this subset continuing to rise there is once again fierce competition between the famously extravagant areas of Mayfair and Knightsbridge, with Knightsbridge once again reigning supreme in the battle for the most expensive residential street in the capital. Not to be out done Mayfair has now created the second most expensive housing development in London with average selling prices of £12.6 million. It also managed to create a new street that became the second most expensive street in the city within 18 months of its opening.
A spokesman for Vyomm said, “Deep pockets are certainly alive and well in Mayfair, Chelsea and Belgravia and buyer activity is brisk currently. Super-prime London will always be one of the most desirable landscapes in which the wealthy and discerning wish to invest.”
This new figures truly shows the disconnect between various subsets in the industry compared to the most recent averages from the House Price Index compiled by the land registry. It also shows how subsets divided by geography can completely change the face of property markets. While the average price change over the year was 1.4% in the UK, mainly influence by a -1.2% drop in the London market, Wales saw a price increase of 6.7% outperforming by some way the other countries of the UK, with it’s closest competitor Northern Ireland seeing an increase of nearly half at 3.5%.