Demand for property in some the capitals’ most high-value locations has fallen, just weeks after the additional 3% stamp duty charge on buy-to-let accommodation was introduced.
In the prime central London sector, demand currently stands at 10% on average, falling by 23% since the changes were introduced, according to the PCL index from eMoov.
Lows
The Index shows that demand is now at its lowest level since records were first taken over one year ago. This indicates a significant change between supply and demand for property valued at £1m or more across London’s most prestigious regions.
During the run up to the stamp duty deadline, eMoov found that the rush to complete transactions had breathed new life into the top end of the market. Demand changed prime central London’s downward spiral and saw increases for the first time since May 2015 during the period.
However, it appears that this increase was superficial, with demand dropping so substantially just one month after the changes.
Demands
Only one region of prime central London, Fitzrovia, had maintained March’s increase in demand. Year-on-year, Belsize Park, Maida Vale, Primrose Hill, Holland Park and Marylebone were the only other regions to see an increase in demand.
Presently, Islington is the most in demand area, with 21%. Belsize Park is next with 19%, followed by Chiswick at 18%, Maida Vale at 16% and Notting Hill with 12%.
At the other end of the scale, St Johns Wood and Mayfair are suffering from the lowest demand levels on record, with just 4%.
Demand for property in PCL slows in April
Artificial
eMoov chief executive officer Russell Quirk, noted, ‘it’s now abundantly clear that the brief resurrection of London’s prime central London market witnessed in March, was an artificial skew as many scrambled to complete a sale before April’s stamp duty deadline.’[1]
‘It seems the extra 3% levy has slowed London’s top end market and this will inevitably lead to further, sizeable reductions in property values,’ Mr Quirk continued. [1]
[1] http://www.propertywire.com/news/europe/prime-central-london-demand-2016051311911.html