Higher taxes and jitters over the EU referendum pushed down high-end London property prices last year as sellers accepted more “realistic” offers, according to upmarket estate agent Savills.
But while owners of multimillion-pound London homes were forced to rein in their expectations, housebuilder Persimmon reported rising revenues from sales of less expensive homes around the country.
Savills said prices for prime central London properties fell by 6.9% compared with last year and 4.9% when including the rest of the capital.
But the real estate firm said a collapse in the number of sales had slowed as sellers adjusted asking prices to reflect increases in stamp duty and the dampening effect of the Brexit vote.
Lucian Cook, Savills’ UK head of residential research, said this helped ease a slump in sales volumes since April, when a 3% stamp duty surcharge was imposed on second homes, triggering a rush to complete transactions before a 1 April deadline.
“After that peak, you had a lull in transactions, which was compounded by Brexit, leading to a very slow summer market,” said Cook.
“Since the vote we’ve seen a further softening but in the post-summer period there have been progressively improving transaction levels.
“Sellers became much more realistic on price as they adjusted to the market reality.”
The number of £1m homes sold in 2016 was down 21% year on year, according to data firm Lonres.
But this represented a strong rebound from the three months to July, when sales volumes slumped to half of 2015 volumes after the stamp duty change.