It’s becoming increasingly clear to the general public that in the last few years the previously booming central London residential property market has - to use a property marketer’s term – been experiencing a ‘downward adjustment’.
From 2010 until 2014 property investors and developers became accustomed to regular double-digit annual price increases, but in an era of ‘austerity’ following the Great Recession, the well-publicised property boom in London led to raised eyebrows, jealousy and anger in some other parts of the UK. Anecdotal tales of foreign buyers leaving apartment blocks untouched while (apparently) making huge windfall gains did not go down very well with many Londoners and those elsewhere in the UK that were struggling to make ends meet.
Politicians took note and acted by slapping a series of increased taxes on foreign buyers, which has resulted in an inevitable exodus. Some investors have since changed tack and shifted their attention to the likes of Manchester and Birmingham as we have reported of late. Property developers have also followed this trend looking to create new projects outside London in commuting areas and in UK regional cities.
As if that was not enough, the toxic combination of a tax clampdown from April 2016 on all second home buyers and buy to let investors via the extra 3% SDLT plus the confidence draining impact of Brexit has led to a slump in transactions and price falls across central London in particular.