Sales of £5 million-plus properties defy prime London slump

Detailed summary

Sales of properties in London’s prime neighbourhoods slumped last month as the UK government's budget put a pause on transactions, figures show.There were 17.5 per cent fewer…

Sales of properties in London’s prime neighbourhoods slumped last month as the UK government's budget put a pause on transactions, figures show.

There were 17.5 per cent fewer sales transactions in October than a year earlier, and 6.6 per cent fewer than the October average for the pre-pandemic years of 2017-19, according to figures by property data firm LonRes.

The number of sales was the lowest in any October since 2018, LonRes said. Prime London analysis includes properties predominantly in central London.

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Those that did sell were likely to have done so below the asking price. Price reductions increased by 8.5 per cent from an already high base, with around half of properties on the market reduced at least once.

However, transactions involving properties worth more than £5 million defied the overall pattern, increasing by 13.6 per cent. New instructions for £5 million-plus properties increased 1.5 per cent, while the number of available homes in that price bracket was 2.3 per cent lower than a year earlier.

LonRes said the monthly £5 million-plus data was often volatile, and the market had been strongly affected by speculation around tax and policy changes in the past 18 months.

Chancellor John Healey’s budget was considered to be relatively pain-free for the property market. However there had been concerns in the build-up that there would be changes to capital gains tax, a further toughening of the incoming mansion tax or the introduction of a wealth tax.

October is often the peak month for offers to be made, as deals are agreed for homes newly listed or relaunched after the summer, but not this year. There were 21.3 per cent fewer under offer in October, the first month this year with fewer under offer than the pre-pandemic average.

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