The London Barometer May 2010

Tuesday, June 01, 2010 by Douglas And Gordon

Sales: May 2010
"After a slow start to the year, February and March saw significant activity in the sales market and prices continuing to rise at the same rate as they did in 2009. However, as we came in to June it was a very different story - the slow decrease in activity in every sector of the property market is largely being caused by fear.

Never a good emotion when confronting big decisions about buying. The bottom line is that investing in a central London property is always going to be a solid investment and unlike stocks and shares, you can live in it.

Personally, I'm confident the new coalition can sort out the shambles of the British economy and I expect price rises to stabilize at between 10% and 12% in 2011."

Lettings: May 2010
"In London, stock levels have fallen by 50% compared to this time last year resulting in a 10% average increase in rents. Any further reduction in supply could have an astonishing effect on prices - especially as we come into summer which is traditionally the busiest time of the year for the lettings market. We have also seen the return of relocation agents who are out in their droves looking for rental property for clients who will be moving in the autumn."

With rental prices remaining strong and steadily increasing, lower stock levels, less void periods and an increasing demand for rental property, many buy-to-let investors have recognised that it is a good time to increase their portfolios despite the threat of increased capital gains tax."