First-time buyers in the capital are faced with soaring house prices as they look to complete deals on properties before the end of the stamp-duty holiday on March 24, according to a report.
House prices are rising faster in London than anywhere else in the country, but the balance on newly agreed sales in the capital is among the highest in the country, the Royal Institution of Chartered Surveyors (RICS) said.
First-time buyers now have under six weeks to take advantage of the stamp-duty holiday, which exempts those purchasing properties worth between £125,000 and £250,000 from paying a one per cent levy.
RICS senior press officer for England (South) Nathanael Moyers said: “The stamp-duty holiday is not as big a factor in London because the housing stock is of such a high value, but it is still something that’s notable, as it is across the country. It is important in London because housing prices are still on the up.”
First-time buyers are having difficulty getting mortgages, so even those who want to take advantage of the stamp-duty holiday may have their hands tied by finances, Moyers pointed out.
Moyers continued: “It looks like there has been a spike of interest because of this (the end of the stamp-duty holiday). It is not a major spike, but it is something that is notable and our surveyors are saying that it is a factor.”
The average sales per surveyors over the last three months in London has increased from 10 in December to 12 in January, according to RICS. The figure was last this high in April 2011, while the last time it has exceeded 12 was in February last year.
London’s sales to stock ratio – the percentage of properties being sold to properties on the books – has reached 38 per cent, RICS said.
Charles Puxley from Jackson-Stops & Staff estate agency in Chelsea believes people are willing to pay whatever is necessary to secure the home they want in London.
Puxley said: “There is still activity in central London but a marked slowdown in good quality instructions. Enquiries have picked up as we get further into the New Year as one would expect but these enquiries cannot match what is available so prices are rising alarmingly fast.
“There is plenty of money around and people are prepared to pay over asking to get what they want on the assumption that the market will catch up. Gazumping is around the corner.”