London enjoys record demand for property

Wednesday, 21 June 2006 12:00 AM

Demand for property in London during May was two thirds higher than the same month last year.

This has led to a 59 per cent increase in sales, while pending sales are also at record levels, according to Hamptons International.

The estate agent says the market currently resembles that of the late 1980s, although it believes the knock on effects of stock market turbulence and upward pressure on interest rates will cause the property market to settle down.

"We would therefore encourage would-be vendors to bring their properties onto the market sooner rather than later in order to capitalise on the extraordinary selling climate before it changes," said Marc Goldberg, London sales director for Hamptons.

The supply of properties is down by ten per cent year-on-year and the agent reports "an acute shortage of stock" in many areas of London.

Outside of the capital, in the south-east and parts of the west country which are covered by Hamptons' branch network, there has been a upturn following the lull during Easter.

Surrey and Kent are experiencing record levels of activity, with an increase in net sales of 77 per cent over May 2005.

In the Cotswolds and the west, net sales are up by 152 per cent on last year although the market is proving sensitive to price, and overpriced properties are languishing on the market.

Ursula Sadler, sales director for Cotswolds and the west, said: "As a region we are now really seeing the ripple effect of prospective purchasers from London and the home counties moving into the area and driving market activity.

"Bath and Cheltenham continue to report the greatest levels of activity in their core market around £500,000."

Back in London, lettings also rose substantially in May when compared with last year - up by 67 per cent.

Hamptons reports that well-presented properties that are competitively priced are being rented almost immediately.

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