Transaction volumes in Prime Central London (PCL) rose in Q4 with a 34% increase year-on-year in the numbers of properties sold, an analysis from property analysts LonRes has found.
Transactions also rose by 15% in 2019 compared with 2018.
Marcus Dixon, head of research at LonRes, said: “In November when the December general election was called, there were fears that prospective buyers would put their move on hold until a result had been declared.
“Instead they chose to purchase and transaction volumes in prime central London (PCL) rose 34% over Q4 2019 compared with the same period a year earlier.
“This was in contrast to the previous quarter (Q3 2019) when talk of changes to top end stamp duty rates resulted in fewer sales and buyers dragged out exchanges waiting for greater clarity.
“In the fourth quarter stamp duty appeared to drop off the political agenda and activity increased.”
The market under £2m saw a 3.3% fall in achieved prices compared with the same period a year ago, but activity increased.
However, the number of homes sold was up 20% in Q4 compared to the same time in 2018.
There were 42% more sales in the £2m to £5m market in Q4, compared with the same period a year ago.
Prices rose by 3.2% compared with Q4 2018.
Activity levels in the £5m plus market rose by 78% in Q4 2019 compared with the same period a year ago, the highest increase of any price bracket in PCL.
This followed a slow third quarter, when volumes over £5m fell by a third (33%) on the same period a year earlier as buyers held off.
This was due in part to potential changes to stamp duty rates mooted by government in the summer.
An increase in activity was not matched by rising prices, with buyers paying on average 4.5% less per square foot than in Q4 2018.
Dixon added: “Sales at £5m or more increased by 78% on Q4 2018.
“This was the highest number of sales recorded in this price bracket for any quarter since Q4 2016.
“Undoubtedly there were sales in Q4 that would have ordinarily gone through in Q3, yet comparing the second half of 2019 with 2018 still shows a 19% increase in sales volumes.
“Alongside an increase in transactions, fewer properties came to the market this quarter.
“New instructions were down 2% on Q4 2018 and were 36% lower than five years ago.
“This means there are 19% fewer homes on the market now than there were a year ago.
“Fewer properties, with sustained levels of demand helped push up average prices which increased by 2.4% across prime central London in Q4 2019 compared with the last three months of 2018.
“This represented the first annual increase for six quarters.
“Some price brackets fared better than others.
“There were increases in achieved prices for homes between £2m and £5m but decreases below £2m and above £5m.”