Despite mid-year falls in Prime Central London prices, the last quarter saw a recovery which lifted prices to 10% above where they started 2010, according to Knight Frank
Despite mid-year falls in Prime Central London prices, the last quarter saw a recovery which lifted prices to 10% above where they started 2010, according to Knight Frank. However, prices are still 4.4% below their March 2008 peak.
Liam Bailey, head of residential research at Knight Frank comments: “The central London residential market continues to outpace the weakening UK market. Prices, which were falling in the middle of the year, appear to have turned a corner and have now risen noticeably for two consecutive months.
“The drivers for this strength in performance are, firstly, strong demand (buyer registrations in the final three months of 2010 were 18% higher than the same period in 2009) set against weak supply: the volume of available properties was only 5% higher in December than in December 2009.
“This strong demand has been underpinned by the ongoing weak pound – still delivering effective discounts of 25% for dollar-based buyers, when compared to London property pricing at the peak of the market in 2008.
“Added to this, the Eurozone crisis has driven new demand from European buyers, looking for the perceived “safe-haven” investment in the central London property market – with European purchaser registrations rising 25% in the final three months of last year on a year-on-year basis.
“In short, the central London market is continuing to buck the wider UK trend of weaker sales volumes and prices. The ability for this trend to continue depends very much on the unique factors in London continuing to play out in favour of the marketplace.”