BUDGET UPDATE ONE MONTH ON
Mayfair Market up 15% despite 2% SDLT Hike
The main property issue of the Budget on the 21st March 2012 was the effect on the market by the raising of SDLT from 5% to 7% on properties over £2M.
I have kept our April report to the end of the month so that we could analyse the market on actual sales evidence and market sentiment.
Our Chancellor, George Osborne, will be pleased to hear that the extra 2% hike has resulted in nearly half a million pounds extra going to the treasury this month as a result of sales of luxury property in Mayfair by our office alone!
Wetherell were involved in 50% of the market transactions (all over the £2M level) giving us 65% of total market share in terms of value sold.
Wetherell have also achieved record sales prices showing an average increase of 15% over the last 2 years. The continuing reversion of offices to residential will push values higher.
Despite the Budget, Q1 2012 total value of residential sales in Mayfair has been the best since Q1 2007.
The SDLT increase has been digested as an increased cost of entry to the prime residential market however the market needs to be cautious of complacency as over 75% of the top end of the market relies on the overseas investor market.
The pound has increased in value against the euro since last year and a combined weakening of the US dollar could make the entry level for Europeans and the Middle East a lot more expensive.
A £2M house in 2011 would have cost €2.27M compared to €2.45M today.
Churchill once remarked that “the length of this document defends it well against the risk of it being read”.
That is why I have kept this report short!