Sales Market
Winter 2023

According to Knight Frank, the number of exchanges in November – the most recent month with full data – in prime London markets was 16.2% higher than the same month in 2021 and 15% higher than the five-year average¹. Given that the markets were still shaking out the mini-budget, this is an encouraging sign.

LonRes found that average prices across prime London continued to recover through 2022 and, thanks to a 4.4% rise across 2022 as a whole, average per sq ft prices were just 1.4% below their previous 2015 peak. However, Knight Frank notes that buyers remain wary, especially in lower-value markets where they rely on debt. The number of offers made in Q4 was 12% below the five-year average, reflecting the uncertainty that has arisen from the spike in borrowing costs. However, as the falling five-year swap rate shows, mortgage rates should continue to decline, which means the fall in offers made could recover.

Meanwhile, the number of offers accepted in Prime London was 24% above the five-year average in Q4, which suggests that any nervousness from prospective buyers will not lead to a substantial fall in sales volumes. The resilience of prices in prime London is set to be tested this spring when activity levels traditionally pick up across the UK. The release of pent-up demand following Brexit and Covid uncertainty boosted activity in London’s £10 million-plus property market. There were 152 super-prime sales in the year to October 2022, whole-market data shows.

The preference for houses, rather than flats continued through 2022, but with some signs that flats were regaining desirability².

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¹ Knight Frank: Residential Review Q1 2023
² LonRes: Prime London Market Update, Winter 2022/23