DEXTERS FORECASTS PRIME CENTRAL LONDON PRICES TO RISE
Dexters forecasts prime central London residential transactions across its offices will double in 2021 with both prices and rental values rising by 2% - 3%.
Dexters, London’s leading independent Chartered Surveyor and Estate Agent, expects to see sales and lettings transactions across its Prime Central London offices doubling in volume during 2021; whilst tipping the Boroughs of Camden and Kensington & Chelsea to be the year's star performers.
Whilst the current Stamp Duty holiday will end in March 2021 Dexters does not expect this to impact on the market greatly since the amounts being saved are minimal when compared to the 12% to 15% rates payable over £1.5m. Also the change will happen in the Spring, which is the start of the busiest time of the year for Londoners moving home. In addition, Dexters observe that the widespread roll out of the COVID-19 vaccine in the new year will help to unlock a big part of the market and tap into significant pent-up demand from both overseas and domestic buyers.
Andy Shepherd, CEO of Dexters, says: “We have an unshakeable belief that London will very quickly bounce back from the challenges of the pandemic. In the past, such as 2008 when prices were briefly depressed, they quite quickly bounced back. Based on our favourable sales and lettings data during 2020 Dexters expects to see sales and lettings transactions across its Prime Central London offices doubling in volume during 2021 with PCL residential property prices and lettings values rising by 2% to 3%. During 2021 the COVID-19 vaccine will bring a return to normality and a restart of mass international travel, resulting in a wave of buyers, tenants and investors returning to the London market. Buyers and investors should always be looking five, ten, even twenty years ahead, over those time periods there is almost universal agreement that the only way for prices is up.”
Dexters says that their Corporate Lettings and International Relocation team have already had thousands of 2021 enquiries, for example the political issues in Hong Kong have accelerated during 2020 and the desire by many Hong Kongers to relocate to the UK, buy homes in London and take up residency remains strong and has merely been paused due to the pandemic. The wave of Hong Kong and other international buyers in London is likely to restart once mass international travel resumes. Another example is buyers from Saudi Arabia wanting to purchase ‘bolt hole’ homes in London due to concerns over the political and economic stability of their country.
Dexters expects Camden to be one of the ‘stand out’ London boroughs in 2021 for property transactions following a record year for the 10 Dexters' offices there. One of the capital's most varied boroughs, Camden has many property hotspots from its borders with the West End in Bloomsbury and Fitzrovia, to the perennial favourites of Hampstead and Highgate. Dexters anticipates that Kentish Town and Tufnell Park will be the strongest performers in 2021, and expect their offices in both locations to see the highest levels of growth in prices and numbers of sales and lettings.
Dexters' other tip for 2021 is the The Royal Borough of Kensington & Chelsea, which they expect to lead the capital in terms of activity and price growth. Dexters have seven offices in the borough including a new Chelsea flagship in Sloane Avenue where business levels have increased dramatically in the past year, as they have to the north in Notting Hill and Westbourne Grove.
Despite the COVID-19 pandemic and the challenges of lockdowns and travel restrictions Dexters performed strongly during 2020 and the company is very optimistic about the year ahead. Dexters forecasts an 18% rise in turnover in 2021 to £125 million and expect to add six new offices to their network. During 2020 the number of sales agreed across the company’s 70 London offices was up 119% on 2019, with the volume of lettings agreed up 29%.
Visits to Dexters website increased by 20% in 2020 as the company continued to grow its London presence. Christmas was no exception with website visits more than doubling compared to 2019. Christmas Day itself saw a 70% rise and then Boxing Day and December 27th, 128% and 131% rises compared to 2019.
The news of the COVID-19 vaccine also boosted buyer and tenant confidence at the end of the year, with November and December seeing the number of sales applicants across all of Dexters London offices rise by 158% and the number of lettings applicants rise by 50% year on year.
Dexters highlights that at the start of the COVID-19 pandemic in early 2020 there were concerns from some property commentators that there would be a mass exodus of buyers and tenants moving out of London. However by the end of 2020 it is clear that there are many more buyers and tenants looking for property in London than are looking to leave, so this has not occurred and now that a vaccine has been found confidence in Central London living and working has rapidly returned.
Dexters currently have over 100,000 people registered looking for a London home and the company’s Corporate Lettings and International Relocation team are busy talking to numerous people from all over the world who are already lining up their moves for early 2021.
Dexters recently carried out a survey of a sample of its 30,000 London Landlords, finding that 99% of them are committed to their investment in the long term and 78% are looking to grow their portfolios. During 2020 there was a lot of choice for domestic tenants, because of the lower number of tourists and business travellers, which enabled many tenants to take longer lets and move closer to central London. This trend is likely to reverse in 2021 as COVID-19 issues recede and short term lettings return, this is most likely to put upward pressure on rents.