House price growth in London rose by 2.4% in the final three months of 2019 – the first annual increase in six quarters, analysis of LonRes prime London sales data has found.
Competition has ramped up in prime areas, with transactions across prime London rising by 34% in Q4 2019 year-on-year.
Marcus Dixon, head of research, LonRes said: “The fortunes of the prime central London sales market began to turn in Q3 2019 and the announcement of a general election did little to derail momentum over the fourth quarter of the year.
“In prime central London both pre and post-election activity increased, with the market at its busiest for three years. Outside central London the market was quieter, albeit with volumes still higher than in 2018.
“A positive shift in sentiment resulted in more new buyer registrations and an increase in the number of properties going under offer, which continued into the new year.”
He went on to say that the latest figures suggest the number of properties under offer in Prime Central London in January is 80% higher than at the same point a year ago.
Promisingly, 98% of agents felt more confident about the health of the market post-election.
Two thirds (69%) expect achieved prices to be higher in 2020, while just 5% expect further falls. Some 89% expect transactions to rise in 2020.
Dixon added: “For lettings, a shortage of stock continues to support rents. Rents rose 3.5% in the final three months of the year – the ninth consecutive quarter.
“Looking ahead, with optimism returning to the prime market, agents have started a new decade with renewed vigor and a positive outlook on prices, rents and activity.
“This is a view we share and with buyers looking more favourably at the prime market there is an opportunity to unlock some of the significant pent-up demand which we have seen building over the last five years.
“But there are a few unknowns which could prove a curveball over the coming year. We are still unsure how well the economy will react to the next stage of Brexit negotiations or if the March budget will benefit or hinder the recovery in central London.”