The prime London sales market recorded both price and transaction falls in February, according to the latest data of the prime London housing market by independent property analysts LonRes.
Average achieved sold prices fell by 7.8% in February on an annual basis, taking values back to early 2014 levels and 3.2% below the 2017-2019 (pre-pandemic) average.
Transactions in February were slightly lower than a year ago, by 2.7% but, in general, activity is holding up relatively better than values.
There were only 0.3% fewer sales in February than the 2017-2019 (pre-pandemic) February average (table 1). The number of properties going under offer slipped slightly after a strong start to the year, with 7.6% fewer in February than a year earlier.
New instructions in February rose by 1.0% on an annual basis which is more than 20% higher than the 2017-2019 (pre-pandemic) average (table 1). Combined with lower transactions levels the stock of homes for sale is rising. At the end of February there were 7.5% more properties available than a year earlier.
The top end of the market is still the best performing sales market sector, with £5m+ activity well above long-term trend levels. Sales in February were 4.2% higher than a year earlier and 25% ahead of the 2017-2019 (pre-pandemic) February average.
New instructions in this market rose by 8.4% annually. However, there is a growing volume of available homes for sale in this market, with 26% more £5m+ properties for sale at the end of February than a year ago.
Annual rental growth across prime London rose slightly in February, to 3.4%, taking values to 26.7% above their 2017-2019 (pre-pandemic) average.
LonRes data for February indicated an annual increase of 14.2% in lets agreed and a 17.6% increase in new instructions, with activity on both measures remaining well below pre-pandemic levels.
Commenting on the findings, LonRes head of research Nick Gregori said:“Once again, the sentiment in the market has been a little more positive than the story told by the latest sales data. Agents are telling us they are busy and while we are recording deals being agreed, there seems to be slow progress from offer to exchange which means actual transaction figures remain muted”.
He added: “February saw sales volumes fall by 2.7% compared to a year earlier, standing in line with the longer term average. Stock on the market for sale is growing steadily, with 7.5% more properties available at the end of February than a year ago”.
