London’s luxury market saw prices increase for a 14th consecutive month in December 2011 as overseas property buyers slugged it out to buy “safer” investments and to compete in a sector that is beginning to suffer from a severe lack of stock, international agency Knight Frank LLP told OPP this week.
The prime central London market has seen the price of houses and apartments leap up to an average of £3.7 million (US $5.7 million) and the December rise pushed things up by a further 0.8% versus November.
According to the latest Knight Frank report, luxury home values in London are now 7% up on their previous peak in March 2008.
“Demand for prime London property in 2011, despite uncertainty resulting from the euro-zone debt crisis and on-going global economic uncertainty, outpaced supply and led to strong price performance,” Liam Bailey, head of residential research, told OPP.
For the full year, prices surged by a shade above 12% and prime central-London prices have risen around 40% since the market’s lowest point in March 2009, says Knight Frank.
The only worrying trend is that the number of new instructions to sell in neighbourhoods such as Knightsbridge and Belgravia plummeted by 6% year-on-year in the fourth quarter of 2011 says Knight Frank.
Agreed, says Camilla Dell, founder of Black Brick Property Solutions LLP, adding that “tight supply has remained a feature of the prime central London property market through 2011 and we see little reason why this might change materially in 2012.”