‘From what I hear everyone is smashing it!’ was how one sales director described the current mood amongst her colleagues selling new homes in London, and with good reason. The sales total for Q3 2020 almost matched the pre-COVID Q1 2020 figure.
- Help to Buy was the top driver of sales,
- BTR came second - knocked off the top spot for the first time in a while.
- Overseas sales came third.
So, the numbers are not reliant on any particularly large boost from BTR, switches to affordable or other forms of bulk disposal. In fact, if you strip BTR out of the picture, the Q3 2020 sales total has not been beaten since Q1 2017.
For the first time in years the main story is about exceedingly busy sales teams dealing with ‘good old fashioned’ private individuals, both in the UK and overseas:
- There are a few relatively high value in long-established residential areas that are selling well to people who already live nearby.
- In more affordable developments, the Help to Buy and the temporary stamp duty break have together driven sales velocities that are unprecedented in recent times for schemes selling mainly to UK owner occupiers.
- The Help to Buy and stamp duty break combo has also helped to revitalise the prospects of several completed developments with previously stalled sales efforts. Consequently, the quantity of completed stock units available for sale across London dropped for the first time since the end of 2014.
- Political uncertainty is normally given as the main reason for sustained overseas interest in UK property, particularly from buyers in Hong Kong.
Given that the sales side of the industry is flourishing under a very specific set of circumstances it is hard to not question what will happen next. In the immediate term, however, the industry appears to have received a boost of confidence that has seen construction starts return almost to the same level as at the start of the year.
