PCL prices up 8.4% on the year – Knight Frank

Average UK house prices rose just 0.2% in February, whilst prime central London property prices went up by 0.9% to take the annual increase to 8.4%, according to Knight Frank’s latest Market Update.

Prices in prime central London continued to climb in February, rising by 0.9% on the month. This takes the annual rise to 8.4%, up from 8.1%. As revealed in Knight Frank’s Wealth Report, London’s price performance last year placed it in 16th place in a league of 80 global luxury property destinations around the world. For more details, visit the Wealth Report.

Activity in the central London market has been robust since the draft Finance Bill gave some clarification on the ARPT, which helped offset the downturn in sales seen last year between March and December. But total sales for £2m+ properties in the year to April are expected to be 15% down on last year, given the higher 7% stamp duty and the new ARPT rules. In contrast, transactions in the sub-£2m band are expected to be up 5%. Prices in this range are also outperforming, with values for sub-£2.5m properties rising by 1.7% in February alone. Meanwhile, the continued decline in sterling is attracting increased interest from buyers from the Eurozone and Asia.

Prime English country house prices are also attracting more interest from overseas buyers, with the modest declines in capital values enhancing the appeal for those buying in currencies other than the pound. Prime country prices are down around 3% on the year, according to the latest quarterly data. Prime Scottish house prices are down 2.7%, although the market in Edinburgh has seen a marked upturn in activity, helping push prices up by a modest 0.6%.