Prime Central London property prices have risen by 1.3% over the third quarter of 2003, a survey by FPDSavills Research reveals.
The research indicates the mini-recession in Prime Central London residential values has halted due to improved sentiment and pent-up demand. But, despite the pick-up, the survey shows year on year growth is still running at -7.2% due to cost cutting in the city in the wake of September 11 and less equity feeding into the market.
Richard Donnell, director at FPDSavills Research, says: “Turnover was down as much as 50% in some market segments. But we expect the recent improvement to continue over the final quarter and into 2004. The strongest growth is likely to be in the value of large houses and apartments. But the majority of buyers will remain price and quality sensitive.”
Donnell forecasts Prime Central London growth values of 4% over 2004, and average growth values of Ǆ.5% over 2003 as a whole.
The survey also reveals a small growth in Prime rents of 0.6% – the first increase in nearly two years, where average rental values declined by 22% between 2001 and 2003. But overall, the research shows rents are down by around -3%, with FPDSavills estimating rental growth to increase to +6% by the end of 2004.
But Simon Tyler, managing director at London-based Chase De Vere Mortgage Management, says; “These figures are surprising as we've found London properties have not increased in value.
“But the lack of good stock on the market may have allowed vendors to achieve the property price that was advertised rather than take offers at well below the asking price.”
Amanda Davidson, partner at London-based Charcol Holden Meehan, adds: “The housing market is vastly inflated, so it is good things are slowing down. The whole process of selling a house in London and arranging a mortgage is definitely taking longer now.”