The UK / London housing market has been on a wild ride over the last few years. The turn of the decade had rural and coastal properties surge with people looking to escape to the country. After that, people began to get called back to the cities. Then came Liz Truss and her mini-budget, which did a greatly outsized amount of damage to the housing market and the UK economy. Then came council tax increases and stamp duty increases.
There’s been a lot going on, but with most of the headline-making potential hits to the market now having settled into the background, it’s heating back up again. However, the most expensive part of the country, London, has seen such an influx of listings that it’s become a buyers’ market. This isn’t to say that houses aren’t selling, more that each buyer has plenty of options, giving them leverage.
Changes in the State of Play
Source: Unsplash
Given how London is the UK’s most prominent professional centre, catering to businesspeople from around the world, it makes sense that plenty of the more affluent residents only come part-time. However, this has contributed to a major housing issue in the capital. To help tackle this, many councils have upped their council tax rates on second homes.
City of London, for example, added a 100 per cent premium to top up council tax in CoL to 200 per cent. Plenty of onlookers, including the mayor of London, Sadiq Khan, have said that this double tax doesn’t go far enough. Yet, it has clearly encouraged enough second homeowners in the capital to sell now. This is partly why there’s such an abundance of property available creating this buyers’ market.
Competition will always be high in London among buyers, but also helping them is how quickly buyers in London and beyond can sell without bringing a chain. If someone opts for the route to sell house in London, they can get cash for the sale in as little as seven days. Among the main reasons for using this platform are to avoid spiralling costs, reduce buy-to-let portfolios, and avoid chain breaks. So, buyers can be much more nimble, too.
Results on the London Housing Market
Source: Pixabay
Second homeowners are being encouraged to sell, and prospective buyers can move faster to sell up and throw their hat into the ring on another property. There’s plenty of movement in London, but not enough for the demand to outweigh the availability. Over the last ten years in June, houses have averaged a 0.4 per cent increase, but this year, a 0.3 per cent dip was noted.
It’s still an incredibly attractive place to live, but even with more availability, prices remain high. For many, you need the value of a house in London to fuel the chance to buy another house in London. In the Greater area of the capital, the average price is £680,000, which certainly makes them unattainable for many. So, to become more affordable, buyers are happy to haggle.
With London house prices more than doubling since 2005, and given the average prices, it makes sense that buyers are having more success when haggling down with the supply being high. It’ll be interesting to see how long the buyers’ market lasts, but with plenty of reasons to sell, it might continue for quite some time.
