LATEST PROPERTY MARKET NEWS
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Super Prime Property is staying TOP OF THE PILE

Friday, 1st August 2008
Source : Times Online

Owning a fancy London home on a notable road has recently lost some of its appeal. The rate of house price falls in London has overtaken that of the rest of the UK, Land Registry data out this week shows, with the average price in the capital now just £345,136, down 2.5per cent in June. These falls are being blamed on the decline of prime: just a few months ago, the prime market was resilient in the face of economic gloom and the credit crunch, but now Knight Frank, the top-end agent, reports a decline of as much as 10 per cent in the value of homes up to £2 million.

The problem is that the owners of prime homes priced under £3 million are dominated by City workers and corporate managers, who have been unnerved by the economic upheavals - a change from recent boom years, when the bonus season sparked months of property one-upmanship. Prime property transactions are down 50 per cent, Knight Frank says, compared with 39 per cent across all price ranges in England and Wales reported by the Land Registry.

But observers are taking comfort from the super-prime market, which Knight Frank now defines as homes priced over £10 million. There is a perception that super-prime will inevitably suffer a turnaround in fortunes in line with that experienced by mainstream prime. But Liam Bailey, Knight Frank's head of research, thinks that it may fleetingly have caught a cold. He explains: “When the credit crunch hit, the super-prime market was the first to stutter. Between October and February super-prime was dead, because of the chatter about changes to non-dom tax rules and nervousness about London's future as a financial centre. But super-prime prices are now higher than a year and even six months ago.”

High net-worth foreign buyers are choosing to stay put in London, seemingly unaffected by economic worries. Paul Tabor, of the property search agent Garrington, says that the rise of countries such as China and India is helping to sustain demand for the best London homes, which are - as ever - in short supply. The result is, as Liam Bailey says, “we are selling twice as many super-prime houses as a year ago. We have still got sealed-bid situations or best and final offers on properties above £8 million, and there is very little discounting.”

For those with a home worth less, experts counsel against feeling too downcast. Yolande Barnes, of Savills, expects prime property to rebound sharply when conditions brighten - a view shared by Liam Bailey.

The Bishops Avenue : Where the money still talks

Tuesday, 29 January 2008
Source : The Telegraph

For a house which resembles a chapel of remembrance at an American military cemetery, it is quite a coup. The sale of Toprak Mansion, in The Bishops Avenue, Highgate, north London, last week for "just short" of its £50 million asking price might seem an extravagance at the best of times. In the middle of a credit crunch, when the US and probably our own economies are heading for recession, it comes across as a surprising postscript to the property boom.

Top whack: Toprak Mansion marks a revival for The Bishops Avenue

Toprak Mansion, built by Turkish entrepreneur Halis Toprak in the early 1990s, is more of a house than it looks from its façade. The 33,000 sq ft property, in two acres of gardens, has an 80ft-wide ballroom, a marble Turkish bath and underground parking for 28 Rolls-Royces. Nevertheless, it had been on the market for nearly three years, and lies in a street which, despite its reputation as "Billonaire's Row" appeared to be going downhill fast.

The recent history of The Bishops Avenue has been one of dereliction, squatters, unseemly planning battles, unsold homes and, in some cases, falling prices. Number 5 sold for £3·15 million in February 2001 and again for £3·05 million in June 2005.

The Bishops Avenue has always invited intrigue. On New Year's Eve, 1984, Greek Cypriot fashion tycoon Aristos Constantinou was shot dead in his private chapel. In the early Nineties, the street lost another prominent resident when Asil Nadir fled to Northern Cyprus to escape charges of theft totalling £34 million.

But the rot set in during the Nineties when the borough of Barnet decided to list some of the original Edwardian houses. The council's opinion of the likes of Toprak Mansion, set out in its planning notes for the street, is damning: "The quality of architecture is often dull or aggressively modern. Many have taken the desire to impress to new heights and pay no regard to the vernacular architecture but rather reflect the vagaries of the individual whim of their owners."

Simon Edwards, of Savills, says: "One of the attractions of The Bishops Avenue was that you could pretty much do what you like because there were no planning restrictions. But when Barnet listed some of the properties, it substantially devalued them. The developers who owned one argued that Barnet had no power to list the properties, but the council won in court."

Avenue on sale: Six beds, sauna and garden for £8·1 million, Seven beds, staff quarters and leisure complex for £22 million.

Some peeved owners chose to let buildings decay while they battled with the planners to replace modest Edwardian houses with grand mansions or apartment blocks. No 44 was left derelict for over a decade. Matters reached a head in 2001 when squatters camped at another derelict property, Jersey House.

Things began to improve, however, in 2005 when permission was given to replace No 44 with two blocks of 12 apartments. Indian steel tycoon Lakshmi Mittal, who lives next door, complained that the flats would impinge upon his privacy. But the apartments, which will be known as Allingham Court and will be marketed by Barratt Homes next month, have helped to remove an eyesore.

Barratt declines to disclose prices, but there is a chance they might just be in range of North Londoners made good. "In the Seventies and Eighties, the street lost a bit of its community spirit," says Trevor Abrahamsohn of Glentree International, which sold Toprak Mansion. "But it has started to regain that. With the development of apartment blocks there are at last some properties which English and European buyers can afford."

Fall in London house asking prices could signal easing across the country

Friday, 24 August 2007
Source : Timesonline

Asking prices for properties in London have fallen for the first time in a year, bringing hope that softer conditions in the capital could ease affordability pressures across the country.

Rightmove, the property website, said that London asking prices, which had risen by around 2 per cent per month for the past year, fell by 0.1 per cent in the past month.

The data suggested that sellers are adopting more realistic pricing expectations as purchasers struggle to cope with the impact of five rises in interest rates over the past year and mounting global economic uncertainty.

Across England and Wales, prices were up by a modest 0.6 per cent in August, compared with 0.3 per cent in July. That took the annual rate up to 12.8 per cent from 10.3 per cent last month.

Despite the rise, Rightmove said that the trend was consistent with house prices increasing more in line with wage inflation for the foreseeable future.

Miles Shipside, commercial director of Rightmove, said that the weaker figures for London were an early indicator of the market’s direction. “This fall is the first we have seen for some time and is an early warning signal that even the buoyant London economy is susceptible to market forces,” he said. “The capital and international status of London means that prices are likely to be more resilient in the longer term, unless the current turmoil in the financial market undermines employment and wealth creation.”

Although City bonuses - a key factor at the top end of the market - may be well down at the end of this year and in early 2008, it is too early for them to be having much impact.

Figures from Nationwide last month suggested that the UK market is finally slowing down, after a “mini-boom” which lasted a year and a half and which saw the revival of double-digit property inflation.

If the weakness reported by Rightmove spreads nationwide, it would lower pressure on the Bank of England to move swiftly with another interest-rate rise. The Bank had suggested in this month’s Inflation Report that a sixth rise might be needed to stem infla-tionary pressures, but expectations of an imminent move have dropped after soft inflation numbers and amid chaos in the financial markets.
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Slowdown in London House Prices

Friday, 24 August 2007
Source : Ian Springett, Chief Executive of www.primelocation.com

The prime London sales market has produced tremendous consecutive month-on-month price growth in recent times. The figures from July’s data highlighting a slowdown are significant, but only for the reason that we are seeing the end of a seventeen month trend of unprecedented price rises. However, we are not seeing overall prime London property values in decline. Indeed, prices are still rising, albeit more slowly than in previous months. With stock levels still some 20% lower than in July 2005, the supply of property is currently not returning to the market fast enough to significantly impact current price inflation levels. In addition, the fundamental component of demand is still supporting the market, primarily through international investors and City employees. We do, however, expect a continued softening of price growth towards the end of 2007.

"The prime country market has really started to perform, with a much healthier balance of demand and supply underpinning steady price rises over the last few months. It is no surprise to see double-digit growth across the South East as the activity in London ripples out into the Home Counties, an increasing area of interest for overseas buyers and those looking to move from the capital.

"Prime London rental property prices continue to thrive, up 10.5% annually. Seasonal rental supply should peak over the next month or two, which may erode the level of price inflation temporarily, but we expect prices to continue with robust growth for the rest of the year."
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Nearly half of all prime country houses in the South East are being bought by buyers from overseas, a new report reveals

Wednesday, 25 August 2007
Source: Country Life

Buyers from overseas are responsible for sweeping up 43% of prime country property in the UK. The latest findings from Knight Frank report that prices of country houses grew by an average of 3.3% in the second quarter of this year.

Manor houses continue to be the strongest performing country house sub sector, with average growth of 4.1% in the quarter. The average price of a manor house now stands at over £3.1million. Further down the scale, the average price of farmhouses increased by 3.0%, while cottages increased by 2.8%.

Price growth has been led by the most expensive brackets: properties worth £4million and above rose by 21.2% in value compared to 8.5% for those priced at under £1million.

Knight Frank's Head of Residential Research, Liam Bailey, comments: 'Payment of City bonuses together with an increasing international presence in the country house market has aided price growth. Cottages have increased price by 2.8% to average a little over £562,000 while the price of farmhouses increased by 3.0% to an average price of just over £1,311,000.

The South West region was the best performing region in the UK with property prices increasing by an average of 5.3% in the first quarter of the year.

Knight Frank say that the indicators from London are positive at the top end (above £3 million) with rapid turnover, low supply and high demand. The mid prime market (£1-3 million) is more subdued.

'In the year to June 2007, overseas buyers accounted for 14% of all prime country house purchases. That figure rises to 43% in the South East of England above £5 million. At this level the share of the super-prime market is taken by: 29% European, 9% Russian, 1% US, 2% Asian, 2% Middle Eastern, 1% Rest of the World.'

Top ten counties for price growth, 12 months to June 2007
County | % price growth, 12 months to June 2007
East Sussex | 27.5%
Wiltshire |25.0%
Cornwall | 24.6%
Kent | 17.9%
Somerset | 16.0%
Hampshire | 15.9%
Surrey | 15.8%
Buckinghamshire | 15.8%
Dorset | 14.5%
Berkshire | 13.7%
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Prices in prime central London continue to soar, due to an unprecedented lack of supply

Monday, 20 August 2007
Source: Country Life

London prices continue to grow at an incredible rate according to Knight Frank, which has recorded the highest monthly rate of growth in the capital – 3.6% – since its records began in 1976. It also says the annualised rate - 36.4% in the 12 months to July. Their research found this is the fastest rate of growth in the capital since 1979 and means that prices in central London are now rising faster than the wider UK market by almost three times, with Belgravia and Knightsbridge leading the way.

Evidence of this becomes obvious when prices per square foot are examined: exceptional London properties are now hitting £3,000 per sq ft, while Knight Frank says some are even breaking through the £4,000 per sq ft barrier; prices unmatched in the rest of the world.

One of the reasons for this huge leap in prices is the demand for top-level property in central London from foreign buyers, points out the agent. Over 61% of all property sales over £4m in this area go to buyers form overseas it says, who tend to hold onto their properties for a long time, and don't release a property onto the market when they buy one.

'We have seen a phenomenal market in central London in recent years – led by a strong City economy, very healthy bonus rounds and growing employment and population levels in London. But this is only one half of the story – the demand side,' said Liam Bailey head of residential research at Knight Frank.

He pointed out that foreign buyers are keener to hang onto their property, even after their period in London – be it for work or pleasure – is over. Property in the capital is now seen as such a good investment that houses are not coming back onto the market in the way they used to. In 2004, according to this research an average foreign landlord letting a property after first having occupied it would only hold it for an average of nine months before sale. In 2007 the figure was 20 months, and is still rising, hence the idea that good London property is 'disappearing'.
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Peace, quiet and property prices could be under threat in southern England if proposals to introduce a new flight path go ahead

Monday, 20 August 2007
Source: Country Life

The National Air Traffic Service (NATS) has proposed to create a new flight path over some of the most cherished and tranquil countryside in England.

The flight path will cut right through the Cotswolds and the North Wessex Downs, slice down the Test Valley and bisect the New Forest – through the middle of the two Areas of Outstanding Natural Beauty and a national park. If this proposal goes ahead, flights on this new route will run throughout the night and they will start as early as April next year.

Airplanes will pass as low as 5,500ft, generating up to 70 decibels of noise. At this volume, the sound of an aircraft overhead is equal to that of a car at 40mph passing about 20ft away. According to the national Tranquillity Map, plotted by the CPRE, this same area is a rare survivor, one of the least disturbed by noise pollution in England.

The proposal also has another dimension. Some 30 airplanes a night will travel along it to begin with, but there is nothing to stop it being used far more heavily by the two southern airports – Bournemouth and Southampton – it is designed to service. Essentially, a five-mile-wide 'motorway' in the sky is being created and it will inevitably generate traffic. Passenger numbers are forecast to triple at Bournemouth airport within 10 years, from one million to three million; Southampton currently handles fewer than two million passengers, but that number is also expected to triple by 2015, and double again to six million by the year 2030.

'We are constantly reviewing airspace. It is a rolling process,' declares a NATS spokesman.
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