London prices £1.3 million to 3 million

[Subprime]

Anyone have any observations about this (very broad) bracket for London houses in the bracket of £1.3 million to £3 million?

Have you sold a property recently in this bracket and was it easy?

Have you bought recently in this bracket and did you have much competition? Did you pay over the asking price?

We have equity of about £1.5m and have been looking to trade up. The reason for the broad price range in the headline is it reflects houses priced in the rung below us and also our absolute maximum purchase price (that we would move heaven and earth and sell everything for).

We have been looking in more expensive areas and it strikes me that there’s either nothing coming on the market or it’s still going up compared to what we would have paid less than 2 years ago.

I was dismayed at how much people who had not maintained let alone improved their homes are asking for when we went to viewings last summer and was convinced they would have to take a hit. How wrong I was: all sold above asking price

Do you think redundancies and slow economic growth will inhibit the London market or will it forever be immune?

From an economic point of view, it has nearly always made sense to trade up in London.

However, given that we have an ageing population, will there be the same demand and ability for the current Gen Y/Z to buy these homes for a decent price in 15 years or so when we are ready to downsize?

If anyone can point me to any good economists’ projections specific to London please do! The general property price thread is too broad hence I’m trying to start one on decent sized
London homes (but not mansions).

I would get advice from EAs used to dealing with the prime property market in London like Savills or Knight Frank.

Take it with a pinch of salt as they are salespeople. But they will be way more knowledgeable than the vast majority of people on Mumsnet.

Sadly I don’t trust them entirely @Twiglets1 as they will always claim there is strong demand… And would you believe that this price bracket is not ‘premium’?! The price is premium but sadly the properties aren’t! I have dealings with KF and their team is split into agents who deal with properties over 3m and those who deal with below…

The price is premium but sadly the properties aren’t!

Could't agree with you more. This is the problem across the market, irrespective of budget.

Name changed.. Yes, it's not quite premium in the London area - that's mansions really. Loads of houses in that bracket near me. To be honest I think you need to pinpoint the roads you are interested in, check actual sold prices on those roads and check price per square foot and decoration/renovation status against what the agent tells you. We had the agent telling us what average price for a square foot but we could come back with the data that it was a lot less!! We got significant negotiation power by listing what needed updating. Sometimes the asking price is pie in the sky and I have heard at the very top end of the market prices have dropped. Ultimately quite a lot of people will
Be in a very bad position if nobody can afford to buy our houses in 15/20 years when we want to downsize - a house is only worth what someone is prepared to pay at the end of the day - in London and surrounding towns a lot depends on the road - there are premium roads and any houses on them will be desirable, even if they are bought to be bulldozed!

Agree @northlondon19. I’ve always looked at sold prices but the streets we look at often have people living there for 30-40 years. Any time we do look at something on a great road but (privately) scoff at the size or condition of the house, the way the garden faces, someone comes
along and offers 100-200k over the asking price! We are talking VERY ordinary homes of 2000 square metres or so changing hands for £2.5 million plus.
Do you also have a formula for recent price per square foot renovation costs? I forgot to add that some of the homes in price bracket above have been near knock down jobs!

I’m in West London. The average price of a 3 bedder is £1.2.
Mine is 4, gorgeous but desperately needs decorating, recently valued at £1.3.
My neighbour’s house, converted to a 5 bedder but looks like something out of Architectural Digest, recently sold for £1.5.

9 years ago, my other neighbour bought the house next door (with an enormous hole in the living room ceiling) which hadn’t been decorated since the 1960s, for £1 million. In my area, a dilapidated house is not at all off putting because the area is one of London’s most attractive. So buyers in my area either want a perfect home they can move right into and live in or one they can tear apart and make their own the minute the sale goes through. That’s what the agent valuing my home said. I don’t think anyone can predict the market accurately. Most of my new neighbours are from Hong Kong and have the money to meet the cost of housing here which, you have to remember, is one of the most expensive cities in the world. That won’t be changing too soon.

My observation and experience is that the condition of the property doesn't really make a difference in this price bracket - I think basically because it's a small proportion of the overall costs if you see what I mean.

If a property needs new carpets, paint, rewire, new boiler, roof, windows, even a new kitchen/bathrooms, it's going to be maybe 10% of the value of the property. Especially when a lot of buyers in this bracket will want to redo to their taste anyway.

My other general observation is that now that more companies are insisting on their staff coming in the office London prices are going up again

OP , by the way, are you new to London? I’m surprised you’re shocked by the state of properties. It’s been this way since forever: Overpriced, dilapidated houses is nothing new. There’s always a demand for housing and people with the money will overpay if they love the area, the schools, the green space, transportation links. Local amenities too. These things really matter to buyers.

I don't but building costs are high, by the time you have changed windows, flooring. Kitchen, bathrooms, utility, fitted furniture- any extensions/remodelling etc you will be well into the 6 figures. In our last road we lived there for 5 years and virtually no houses came up for sale. You need to show estate agents you are serious buyers, be firm on the roads you will consider and the amount of work you are prepared to do, budget etc. keep bothering them so they show you houses before they hit right move, they may have off market options as some people don't want their house online, or houses they haven't taken all the photos for sale yet - but you have to be serious buyers - there are a lot of window shoppers and right move addicts!

We are talking VERY ordinary homes of 2000 square metres or so changing hands for £2.5 million plus.

That’s London for you.

And I’m speaking as an American (been here 25 years though). Back home, it’s expected that you paint, decorate, and recarpet prior to putting the house on the market.

Super easy to get properly burnt in that price bracket. Very much a case of buyer beware...

London has always been popular often with overseas buyers. Barnes, Chiswick are very desirable areas and providing the prices are not particularly outragous they do sell. Also, people dont tend to move out once in...

We sold within the last couple of years in this bracket and we had plenty of interest in our house and plenty of competition in the houses we were interested in. I think there are certain highly specific mini markets within larger areas where prices are holding up. In other places prices are falling.

Savills and Knight Frank both have a buying agent side to the business, that sounds more like what the OP might need:

https://www.knightfrank.co.uk/residential/buying-property/the-buying-solution

https://www.savills.co.uk/services/buying-or-selling/using-a-buying-agent.aspx

There is absolutely nothing coming on the market that doesn’t have a major flaw such as main road, split in flats or in dire need of modernisation. And while price are not booming, there is a strong pool of buyers at every level of the bracket you mentioned. I would have assumed 3m is plenty for a large 4/5 bed in a desirable area but I guess everyone is thinking that looking at the next ring up.

I think there are certain highly specific mini markets within larger areas where prices are holding up. In other places prices are falling

I agree. There are also specific roads in key areas that are so sought after there are usually buyers waiting for houses to come up.

Yes we have been targeting roads and got close but our buyer was about 48 hours too late with his offer and someone swooped.

I have lived in London for two decades but am staggered by the difference in price based on just a street or two difference. I’ve lived her long enough to remember when Hackney was a bit of a dump and De Beauvoir Town was quite cheap!

Not saying where we live but for £3 million you would get an incredible Victorian villa yet we are 10 minutes from very central London. I would say our area provides great value but you still need quite deep pockets.

@Coffeecreme12 There is nothing coming on in our target area either that isn’t facing the wrong way eg east or north garden or staring into on an estate or backing onto a main road. I can deal with renovation costs etc but can’t change the positioning of a house.

@Mirabai May I ask where you sold and where you moved to? Where do you go from a £3 million house?

I went to a seminar recently and the rightmove data analytics guy was there and they have really accurate property analysis. They sell it mostly to mortgage Companies but if you can get your hands of any of their data I'd say it would be really good if you want facts.
Anecdotally, where I live in North London prices are still pretty punchy. It's a desirable area and everyone still wants to live here. I've seen nearby people have just sold a very ordinary house for £1.3m and another tiny period property on the market for £1m. The people who sold for £1.3m made a couple hundred in a few years but sold quickly whereas before it was on the market for ages.
So good parts of London are as they always were, very little in the way of bargains, anything that's a doer upper has very little in the way of a discount because that's what people want.

Wow So even at the £4m mark there are compromises? May I ask roughly which area you are in @newnamesix ?

I think we made the fatal error of buying in ‘up and coming’ areas and paying off our mortgage a few years ago rather than upsizing and leveraging.

Is everyone else funding property at the top end of the figure through cash entirely or is it mortgaged?

We are not proper City folk but DH has been on early six figures for a long time (alas no start up
type windfall and no one on either side to inherit from plus school fees to pay as live in dire secondary area)…

What sort of things does the rightmove data show @Sodndashitall ? Weirdly I was recently at a seminar with someone very senior from there but bottled asking him details as he wasn’t there to talk house prices as such.

The Times recently had a link to a tool which could supposedly predict prices in your area but I think these are often unreliable as they throw flats into the mix with houses and this skews the price. Or you may have one person who got lucky and bought their house for 500k 15 years ago and that throws out the data on your road.

TMI, I’ll PM you OP. And request my post is deleted.

I feel like this about the Wimbledon area. It's out of budget for me anyway, but some houses are in the £1.2 million range but they look like ordinary houses you can find anywhere. There is nothing special about them whatsoever, some even look absolutely dreadful having nothing done to then for 30+ years

Sorry @Mirabai. Don’t want you to be too outing! I know the feeling as I’ve spotted one of our potential buyers asking about our area on here.

Our house is bang in the middle of this range and I track what comes on the market near us (North London)- almost nothing, a handful of houses in 6 months.