The number of super-prime property transactions in London fell by a third in 2015 as the impact of a stamp duty increase made buyers more sensitive.
Research from Knight Frank found that sales of £10m plus properties slumped as the stamp duty increase meant the transaction tax on such sales rose to £1.1m from £700,000, or an additional 4% of the sale price.
The property agent said there are signs that the 2014 changes are being absorbed by the market and asking prices now reflect the more subdued state of demand.
Tim Wright of Knight Frank, said: “To some extent buyers and sellers have become tired of the inaction.
“As asking prices become more realistic, buyers have seen the market is flat rather than falling off a cliff and are therefore encouraged to act.”
Knight Frank’s Daniel Daggers said the market needed to correct believes it is not ready to take-off.
“The overriding mood is one of caution but at the right price demand is strong and momentum is returning,” said Daniel.
Richard Cutt, also at Knight Frank, added: “The wealth preservation appeal of prime London property among UK and overseas buyers remains significant, most recently against the backdrop of falling commodity prices.”
Areas such as Kensington and Mayfair continued their upwards trajectory in 2015 with Mayfair benefiting from a high-quality development pipeline.
“These developments are some of the very best residential schemes in London and continue to fuel Mayfair’s return to the top of the list of most desirable addresses in London,” said Richard.
Leave a comment