Lucy Morton, senior partner and head of lettings at Prime Central London estate agency, W A Ellis, comments:
"We are now receiving enquiries in their droves about lettings over the Olympic period (27th July to 12th August or realistically from 20th July to 19th August). The Para-Olympic games start on 29th August and run until 9th September, so at the very best, the requirement will run from 20th July to 16th September.
"Interestingly, 90% of these enquiries are coming from landlords, which tells a story in itself. At the moment, there is very limited demand from tenants.
"In my opinion, it is the hoteliers who will benefit from increased occupancy and rates and not the majority of landlords - in fact, I offer a word of caution to investor landlords who are considering losing their long term, blue chip tenants for this short term gain.
"Looking at the pros first, the clear advantage is that the average increase is 400% of the long term rental value but this may vary depending on the property and location. Rents will be paid in full and in advance for the entire let but will include all utility bills including gas, water, electricity, water rates, television licence and Council Tax (with the exception of telephone, internet and satellite/cable television).
"However, the major drawback is the void period running up to the let and more importantly, following the let. If long term investors jump on the Olympic bandwagon and launch their properties back on to the market in September, there is a strong risk that there will be a sudden surge in supply of properties available without the demand.
"We are already noticing a reduction in demand levels - I believe that the lettings market plateaued in October 2011 and in some areas, is now marginally dropping. The reason for this change in market conditions is that the City is not employing its normal influx of expats and it is these tenants who underpin the lettings market.
"With the economic outlook looking bleak, this situation is not going to improve and therefore, the market will not be able to cope with this extra supply which could drive rents down.
"In addition, anyone wanting to let during the Olympics will also need to apply for planning permission to let their property for less than 90 days. Without it, they are breaking the law and could be fined up to £20,000. The future sale of the property could also be affected as any enforcement notice will be registered as a legal charge and this may deter future buyers.
"A short let may also invalidate some insurance policies. If the rent is under £1923 per week, it will become an Assured Shorthold Tenancy and therefore, a Section 21 Notice must be served. If the tenant refuses to leave, they may be able to stay for six months until Court proceedings can be initiated.
"The final major risk is wear and tear. Landlords can't be sure that the tenant will treat their property as their home during this short period. No deposit will cover the replacement value of furniture and fixtures and fittings, let alone any replacement of carpets or redecorations.
"My advice to long term investors is to ignore the hype and temptation, unless the current tenancy is actually coming to an end in July, or unless you are a homeowner who wants to avoid the Olympic gridlock in London and flee to calmer and possibly warmer climates."
SALES
Richard Barber, partner in residential sales at W A Ellis, comments:
"Without wishing to sound like a 'stuck record', stock levels are at an all time low and invitations to value potential new instructions are at considerable lower levels than at the same time last year.
"That said, enquiry levels are still robust and the demand for high quality stock is most encouraging - the ability to satisfy this demand, however, will test the ingenuity and lateral thinking ability of our sales team.
"I believe it will be an interesting year and the current indicators would seem to point towards continued increases in capital values.
"Much has been made of George Osborne's intended attack on the 'super-rich' and various stamp duty land tax mitigation schemes. It has been common practice over the last 20 years for high value London properties to be owned in off shore companies, often registered in Jersey or Guernsey where the sole asset is a property.
"As a consequence, when the 'company' is sold, stamp duty is charged on the shares of the company and treated as a share transaction as opposed to a property transaction with stamp duty charged at 0.5%, instead of the more punitive rate of 5%. The 4.5% saving is usually shared between seller and purchaser.
"The Treasury estimate that approximately £1 billion of revenue is being lost annually via the sale of property-based 'companies', and, as a consequence, it is widely rumoured that they will legislate to prevent this.
"I believe that the Inland Revenue will adopt a similar approach to France, where, if a company's assets are more than 50% land or property, any share transfer is liable to stamp duty at the rate of 5%.
"Consequently, the stamp duty mitigation advantage of holding a property in a company name will be removed. Naturally, many overseas investors will still choose to own properties in company names as a 'hedge' against their own country's tax regimes.
"I don't believe that a clamp down - anticipated to be announced in the 21st March budget - poses a threat to the upper end of the London property market, simply because, in our experience, whilst many prop
