According to Marsh & Parsons’ latest London Property Monitor, 79% of property purchases were made by domestic UK buyers in Q3, up from 75% a year ago.
Domestic mortgage buyers and first-time buyers have become more prominent in the London market, with the proportion of mortgage buyers in Prime London soaring from 53% in Q2 to 65% in Q3.
At the same time, overseas and foreign nationality buyers accounted for just over a fifth (21%) of all Prime London property purchases during Q3 2015, which has fallen quarter-on-quarter, and is also down from 25% of all sales during the third quarter of 2014.
This pattern is also being mirrored in Prime Central London, traditionally favoured by overseas investors, with the proportion of foreign buyers standing at 32%, down from 34% in Q2 and 37% a year ago. The investor share of the market has also dipped in Prime Central London over the past three months. Investors accounted for 35% of all Prime Central London sales during Q3, a considerable drop from 42% in Q2.
Yet with domestic buyers stemming this shortfall, overall demand for Prime London homes has grown in the three months to September 2015, and the number of registered buyers has climbed 4%.
Peter Rollings, CEO of Marsh & Parsons, commented:
“The London property market has had to grit its teeth and bear the brunt of some rather trying taxation changes in recent months. At the high-end buyers are at the rock face of the new steeper stamp duty, and from overseas the strength of sterling, and government encroachments on nom-dom status make investing in the London property market seem daunting. This has cast some shadows over the capital, but the millions of Londoners who live and work in the city have acclimatised much more quickly to the property taxation changes, and have risen up to fill the void left by overseas purchasers and investors. We’re noticing longer purchase chains than ever as domestic buyers really start to dominate the market, and demand is really putting a strain on supply. This should ensure that London houses prices and sales activity continue their ascent into 2016.”
