Leasehold Enfranchisement | Freehold Purchase | Lease Extension | London | George Pope FRICS

The Central London residential market has continued to flourish through the summer with demand exceeding the supply of flats and houses.

August is usually a little quiet due to family holidays, the month coinciding with certain Press comment suggesting a cooling down of the market countrywide.

Many lessees are showing their confidence in Belgravia, Chelsea, Kensington, Knightsbridge etc. by serving Notices to buy their freeholds/extend their leases. I am very busy advising many clients.

If you are contemplating buying your freehold or extending your lease, please do not hesitate to contact me for a discussion.

The Central London residential market has been extraordinarily strong during the past months despite the approaching General Election. In the past, the market has gone quiet in the lead up to an election, but 2010 has been different perhaps due to the short supply of flats/houses being offered for sale and a strong demand.

On all the major London Estates lessees are proceeding with their Notices of Claim for freeholds/lease extensions. If you wish to discuss this process in detail please contact me.

2009 has been a quite extraordinary year for Central London residential property because most pundits expressed pessimism when making predictions in December 2008.

Following the banking crises of September 2008, not surprisingly values fell, but in February/March 2009 the market stabilised, since which time values in South West London have generally risen back to previous peak prices. Some other areas in London have lagged behind e.g. Mayfair.

Why the rise? The most salient reasons for the market strengthening has been the FTSE rising again to over 5,000, a relative lack of supply for a strong demand and the exchange rate between Euro and GBP, making property values quite attractive to many Europeans.

Where now? I cannot see the market rising in 2010 due to the General Election and what will come when either party is returned, assuming no hung Parliament.

Generally, many leaseholders have decided that they should commence the purchase of buying their freeholds or lease extensions; there seems to be confidence that values will not fall. Having said that, if values fall, these lessees can withdraw their Notices of Claim and await an appropriate moment to recommence the procedure.

Please do not hesitate to contact me to discuss matters in greater detail.

A happy new year

The Central London flat and house market continues to improve. Recently the Evening Standard confirmed an opinion shared by many agents that in many instances prices have climbed back to the 2007 peak. The much relied upon Savills Index shows values to have risen by about 7.5% generally since March 2009.

Of course there are always "bears" in any market. Has it all happened too quickly? Is there going to be a correction or will the rise be sustained? I am not here to predict the future but let us not forget the FTSE 100 has risen by about 40% since the trough of 3500.

Unless a leaseholder can predict the market with a crystal ball, I am recommending acquiring the freehold/lease extension now, rather than wait.

During the past few weeks we have experienced at least two Building Societies reporting a rise in property values. Also, optimistic reports from Savills Research Department and Royal Institution of Chartered Surveyors. These comments have come on the back of my personal experience in the market that values have stabilised albeit about 20%-25% below peak.

During the last four weeks an agent offered a Belgravia freehold for £1.65 million (two other agents recommended similar price). After forty viewings in ten days the property sold for over £2 million. This suggests an improved market and perhaps a lack of supply.

I am recommending my clients to proceed with buying freeholds/lease extensions under the Leasehold Enfranchisement legislation NOW rather than wait for the possibility that the market may fall further. A further fall now seems unlikely.

With the market falling during the past twelve months, lessees have wisely delayed commencing the procedure by serving a Notice of Claim, the date of which is important, being the date of valuation. One appears foolish if values fall after serving the Notice.

Currently some good sales are being experienced in Central London due to lack of supply, generally about 25% off the peak, suggesting the market may be stabilising. Perhaps lessees should wait for a month or so to determine if it is merely a false dawn, but I recommend lessees prepare themselves to commence this important acquisition in the months ahead, particularly if the trough has been reached and the market is seen to have bottomed out. Green shoots are appearing but a late frost could be damaging! Watch this space.