The London property market is as challenging as it has ever been, says Cluttons head of residential
James Hyman, the head of residential at Cluttons, the property consultants and estate agent specialists, has said that the London property market is as challenging as it has ever been.
During a PropCast on the London property market with Blackstock Consulting managing director Andrew Teacher, Hyman said that the current cycle is the “most unusual one” he has ever seen.
The unusual nature of the current market is due to a “stand off”, where a large proportion of people don’t need to sell their properties which has underpinned the current property values. According to Hyman, if there was an abundance of supply in the London property market, it would turn into a “complete buyers market”.
Hyman predicts that the London market is set to face a further drop from in values of between five to twelve percent before sentiment returns to the market
Amid the challenging market, Hyman believes that the two types of property selling right now in London are luxury properties and products at the mid-market. Developments in technology have been vital in terms of making the sector more transparent and enabling worldwide access for buyers to view properties.
As London’s biggest challenge remains affordability, the vast majority of Londoners use price as means of modifying their search criteria. However, many areas of London have gone through a process of regeneration which currently satisfy this affordability criteria, such as Westbourne Grove, Bermondsey Spa and Deptford.
The market is currently faced with the challenge of tax hikes and the uncertainty surrounding Brexit. Hyman confirms that “over the last 2 years the majority of buyers have been owner-occupiers, and the opportunities for investors within Central London have been far and few between”. Yet Hyman predicts that “as the market corrects itself, with further price reductions, yields are beginning to improve”.
Hyman concludes by calling on the current Housing Minister, James Brokenshire MP, to enact “a change in legislation regarding ‘help-to buy’ and to bring it back into the second-hand market”. Hyman encourages giving more people “an opportunity to buy ideally what they would like, instead of being pushed into the newly built sector”.