Demand is starting to return to London’s prime market, with sales price reductions according to the latest data from estate agents.
At the upper end of the London market, properties are now discounted by an average of 3.6% before they find a buyer. Estate and letting agents Benham and Reeves point out that’s less than the average discount of 4.5% applied a year ago.
It says that while prime properties are still on sale in London, in 14 of the 20 areas analyzed the size of these discounts has decreased year on year.
Data shows that these discounts have fallen the most for properties sold in Bayswater, Maida Vale, Hammersmith and Brook Green, Chiswick and North Kensington. It is closely followed by the properties of Richmond, Kew and Sheen, Battersea, Clapham and Wandsworth. In these areas, the difference between asking prices and selling prices has been reduced by more than 40% over this period.
The biggest discounts are currently for prime properties in Mayfair and St. James’s, where the average buyer gets a 7.9% discount. Marylebone and Fitzrovia, Bloomsbury and Soho are other areas where properties are still being sold at a significant discount to the asking price.
Figures from Benham and Reeves show that the average discount, of 3.6%, equates to a reduction of £47 per square foot, or a saving of £24,508 on the average London apartment. This compares to a discount of £56 per square foot – a saving of £29,418 last year.
Benham and Reeves director Marc von Grundherr said: “The prime London market has yet to fully find its feet after a rather sustained period of muted property price performance, initially boosted by the political uncertainty of Brexit, followed by the impact of the pandemic and foreign travel restrictions.
“However, it now appears that the tide is starting to turn and we have seen a growing resurgence of buyer interest in London’s prime property market. So while sellers are still offering discounts in order to find a buyer, the extent to which they need to lower their expectations is diminishing and this is a trend that is expected to continue as the year progresses.