For the first time in 30 years, London’s population is falling. The coronavirus pandemic has stemmed the flow of people moving into the capital, whilst creating new reasons for residents to depart. So what does this mean for London’s most exclusive housing market?
Before coronavirus struck, London’s prime housing market had enjoyed the best start to a year for half a decade. But with offices shuttered, overseas buyers grounded and a rise in the number of households leaving the capital in search of more space, prime central London’s housing market ground to a halt. Despite the challenges, the number of sales agreed in central London’s most exclusive postcodes in 2020 was within 15% of 2019 levels, and up on 2017 and 2018.
With demand for more space top of buyer’s priority lists, houses have outperformed flats. Last year the average house in prime central London went under offer within 62 days of its instruction, for flats it took 65 days on average – a reversal of 2019. LonRes noted a 1.3% price fall for flats in Q4 2020 compared with the same time last year, in sharp contrast to the 5.7% annual increase for houses. Last year, flats made up 78% of completions in prime central London, the smallest share since 1996.