London property expert Jamie Salisbury argues that the uncertainty around Brexit has created the perfect storm for those looking to get a deal before Brexit.
Since Britain voted to leave the European Union in June 2016, a mysterious virus has spread across London. Known in the medical profession as bacterial house price angst, symptoms include fear of falling house prices, and cold sweats upon news of negative equity. Amid the great Brexit freeze, buyers and sellers are understandably waiting for certainty before they trade in their igloo. But Nested has done some number crunching, and we think there’s no time like the present to buy your next London home.
There’s no getting away from it — house prices in London have taken a shellacking since June 2016. Of the 107,958 properties currently for sale in the capital, 29% of sellers have dropped their asking price, and 13% have offered discounts of more than £30,000. In total, we’re talking £2bn worth of savings for would-be buyers.
“Amid this endless uncertainty and gloom there are great opportunities out there for buyers, if they’re bold enough to seize them,” says Nested’s very own Jamie Salisbury.
What kinds of opportunities? Well, some of the biggest price reductions have been in parts of London you could only previously buy on a Monopoly board. The greatest discounts have been in Westminster, where £402m has been wiped off total asking prices, followed by Kensington & Chelsea (£216m) and Chelsea itself (£115m).
Elsewhere, some of the biggest price drops are in Wandsworth, Camden and Tower Hamlets; the latter has high areas of deprivation but is also home to the soaring ‘scrapers of Canary Wharf. It might seem odd that some of London’s most gilded streets have seen prices plummeting, but remember that prime central London (and thereabouts) has long been favoured by overseas investors.
With Britain’s currency status and trading relationships in the balance, inner London is more exposed than outer London and other regional cities. So if your long-held dream is to buy a pied-à-terre in Paddington, your timing couldn’t be much better than now.
“With money still relatively cheap to borrow and prices falling, buyers can realistically snap up properties they couldn’t have afforded in a stronger market,” Jamie explains.
It seems counterintuitive. In a falling market, isn’t it better to batten down the hatches, stay where you are and invest all your savings into a new loft extension with a power shower? Not necessarily, because unless you’re already in your dream home, the small window between now and October 31st — do or die — could be your best shot at getting that canalside pad in Primrose Hill.
At some point, the market will price-in the Brexit outcome — good, bad or ugly — and if investors like anything, it’s certainty. It’s not often that Georgian townhouses and mews cottages are so eminently biddable, but of course, these aren’t ordinary times.
In the bubbly days of pre-2016, viewing a property really wasn’t much fun, unless your idea of fun is to rub elbows with 20 other bidders for a doer-upper with damp. The beauty of today’s market is the lack of competition from other buyers; you can bide your time, bid under asking price, and get a good deal — if not on the backstop, then the backsplash. But when the brave new Brexity world is finally here, you might not have that luxury anymore.
For now at least, London buyers have a once-in-a-generation passport to Pimlico. And remember, if there’s one thing worse than Brexit, it’s Regrexit.
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