Would-be sellers should think about putting their homes on the market now, as buyer demand in London remains healthy despite cooling buy-to-let interest and uncertainty ahead of the EU referendum, according to the latest data from Chestertons.
The number of buyers registering for a property search with Chestertons was up by 44% in the first three months of 2016, and house viewings increased by almost a third during this period. While these figures may have been artificially inflated by the buy-to-let rush in the first quarter, comparing the year to May against the same period in 2015, viewings still rose 11.3% and there has been a notable rise in the number of people looking to buy a home to live in, particularly post 1st April.
Guy Gittins, Executive Director at Chestertons, says: "There's been a lot of talk about a London property 'bubble', with one UK estate agent going so far as to call the top of the market. But the simple rule of supply and demand means that, while the rate of growth has slowed in some parts of London, nowhere are they likely to fall back significantly, even in the event of a Brexit.
"The extra 3% stamp duty on second homes and EU referendum uncertainty means buy-to-let investors in particular are reviewing their strategies, however we are finding that the slack is being taken up by committed buyers looking for the right home in the right location – whether that's for work, family or school reasons. Overseas buyers tempted by the relatively cheap pound have also returned to buy up prime London homes.
"Sellers, many of whom waited all of last year for the 'perfect' moment to put their homes on the market, are coming to terms with a new reality of increased stamp duty and cooling buy-to-let demand. Most homeowners know prices can't keep on rising exponentially, and are realistic that the 'wait and see' approach doesn't always pay off – remember, the market-wide bounce many predicted after last year's unexpectedly decisive General Election failed to materialise, showing that political factors only have a limited impact on housing market economics.
"Sellers are in many cases being pragmatic, and that can mean they are more willing to negotiate on price to achieve a sale than they were last year; this is borne out by our figures – exchanges rose by 8% over the first quarter of 2016 and were almost a third up on the corresponding period of 2015, while fall-throughs decreased by 5%.
"Anyone considering putting their house on the market may feel it's safer to wait until after the EU vote, but with the threat of Brexit seeming to recede, now may be the ideal moment to capitalise on steady domestic demand and overseas buyers getting more for their money against a weak pound, particularly as sterling is likely to rebound strongly if the UK votes to stay in the EU on 23rd June."