Hamptons International Announces its 2012 Property Market Forecasts

LONDON, November 2, 2011 -

Hamptons International has today announced its market forecasts for 2012, predicting a continued but diminished divide between property in London and the rest of the country next year for both the Sales and Lettings markets.

Hamptons International expects mainstream sales values across the UK to fall by two per cent.  The South of England is predicted to experience similar conditions to 2011, with levels remaining flat.  The London market will continue to attract investment opportunities and drive market conditions, with Prime London in particular expected to see a four per cent increase in sales values over the next 12 months.

The 2012 Sales Market

    Sale

    National: -2%

    South of England: 0%

    London: +1%

    Prime London: +4%

Based on several key assumptions*, Hamptons International expects the Sales market next year to be characterised by the following themes:

• A continued depressed Pound Sterling exchange rate which will support international demand in Prime Central London.
• Favourable mortgage lending terms as a result of low Bank of England base rate, with more competition from lenders.
• London and Prime property in particular will continue to represent a safe haven/ defensive investment akin to gold, supporting demand and prices.
• Country markets in the South of England will see a modest decline from the flat market of 2011.
• The rest of the UK is expected to improve modestly but this will only slow the declines of 2011 rather than produce positive price movements.

Marc Goldberg, Head of Sales at Hamptons International, commented: “Set against a backdrop of continued economic uncertainty, we are expecting the 2012 property market to be a more conservative re-run of 2011. 

“We expect to see a marginal increase in transaction levels throughout 2012, with much less diversity in price movements - just as we expect the declines in activity in the South of the UK and nationwide to slow, so too do we expect the sometimes meteoric rises in Prime Central London to moderate.”

The 2012 Rental Market

The rental market has been strong in 2011 and moving into 2012, Hamptons International predicts this to improve marginally, with two per cent growth across the South of the UK.  The London Lettings market is expected to see more growth, with a predicted five per cent increase in prices and three per cent in Prime London.

Lettings

        South of England: +2%

        London: +5%

        Prime London: +3%

Overall, Hamptons International expects the UK rental market to be characterised by the following themes:

• Rental demand expected to remain strong for the mainstream market, with some softening of the market at the top-end due to economic uncertainty.
• High rents in Central London will continue to push demand further out as renters are unable and/or unwilling to stretch budgets. This will support rental growth in areas of Inner London such as Islington, Ealing, Clapham and further out towards Wimbledon, Richmond, Esher and Guildford.

Lesley Cairns, Head of Lettings at Hamptons International, commented: “We are expecting the rental market boom to continue in Prime and Greater London, driven by a continued imbalance between supply and demand.  For the first time ever, the private rented sector will house more people in the UK than the social rented sector, which will put continued pressure on prices.

“Rents are likely to continue to rise, although this rise will be moderated as tenants find ever-more creative ways to make life more affordable.  We are already seeing increasing numbers of flat sharers and “outmigrators” looking for a similar quality of stock and location but prepared to move from Zone one to Zones two, three and four to find it.  Both of these trends are likely to become more widespread throughout 2012.”

For media enquiries please contact:
Aisling Gray, Senior PR Manager,
Hampton International
32 Grosvenor Square
London
W1K 2HJ, UK
Phone: +44(0)20-7758-8488
graya@hamptons-int.com

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