September saw some positive signs for the prime London sales market after a quiet end to the summer, data from LonRes’ latest report has revealed.
The report, covering September 2024, saw that while transactions for the month were lower than last year, they were above the long-term September average.
Values continued to remain broadly steady with the average price achieved across prime London around £1300 per sq. ft.
There were 5.7% fewer sales transactions in September than a year earlier, but 5.0% more than the 2017 to 2019 September average.
The year-to-date sales total for the first nine months of 2024 was 2.1% below last year, suggesting buyers remain active despite ongoing challenges in the market such as a weak economy and worries around policy and tax changes.
A key metric for this point in the year is under offer numbers, which give a more immediate sense of buying activity.
In September there were 22.1% more than a year earlier, 20.3% above the long-term average, indicating that a strong pipeline of sales is building up.
Looking at Q3 as a whole, the number of properties going under offer was 17.5% higher than last year and 21.4% more than the pre-pandemic Q3 average.
The shorter-term metrics continue to indicate a slowdown at the top end of the market, with high supply and weaker demand.
New £5m-plus instructions rose by 36.1% compared to last September, and at the end of the month there were 27.8% more properties for sale than a year earlier.Â
Transactions in September were 2.9% lower than a year earlier while under offers were 38.5% lower over the same period.
In addition, the data for September continues to show that the prime London lettings market is subdued, with most metrics in line with last year.
Annual rental growth fell slightly in September to 2.2%, but average rents across prime London are 33.9% above their 2017 to 2019 average.
There were 16.4% fewer lets agreed in September than a year earlier, 56.3% below the 2017 to 2019 September average.
For the year-to-date, lettings activity is 2.9% ahead of where it was at the same point in 2023.
New letting instructions in September were 6.7% lower than a year earlier, suggesting that activity may be constrained by a lack of new supply.
The number of available homes to let across prime London at the end of September fell compared to August but there were 8.9% more homes on the market than a year earlier.
This was 46.9% fewer than five years ago.
Nick Gregori, head of research at LonRes, said: “September is traditionally the start of the autumn selling season and, despite market sentiment appearing somewhat mixed, activity across prime central London has started to pick up.
“New instructions have risen strongly as they usually do at this point in the year, but under offer numbers have followed suit very quickly, indicating robust demand.
“It is too early for these deals to have turned into actual exchanges, but the signs are promising for an improvement in transaction numbers over the closing months of 2024.”
He added: “The darker clouds on the horizon are provided by the looming Budget on 30 October.
“Compared to a month ago, the expected tax changes that would be considered unhelpful for the prime London property market seem less certain to be introduced, but the general messaging around the national finances and the required fixes remains negative.
“Negativity and uncertainty combined are not a recipe for strong activity in a discretionary market.
“The top end of the market continues to be most affected by weak sentiment, but activity was always likely to fall back from the high levels recorded in 2021 and 2022 anyway.
“Demand – measured by homes going under offer – has been volatile this year, while new £5m+ instructions have grown steadily and the stock of available homes is up more than a quarter over the past year.
“Agents have reported buyers choosing to wait for the outcome of the Budget while clearly sellers have decided to put their homes on the market regardless.”
