"With property investors frontloading their transactions into the first quarter of the year, activity was always likely to take a slight step back in the second quarter and so it transpired."
However Outer Prime London prevented this fall being more pronounced with a 0.4% quarterly uptick.
Cooling prices may have benefited first-time buyers, who accounted for more than a third of purchases to "dominate the property market" in Prime London in Q2.
First-time buyers grew their share from 22% in Q1 to 34% in Q2, as buy-to-let investor activity fell following the rush to beat the additional Stamp Duty levy.
Landlord interest cooled in Q2 to just 13% of sales, down from an "uncharacteristically high" 36% in Q1.
Annually, Prime London prices saw a 1.3% increase, rising to 2.7% in Outer Prime London. This has been driven by particularly strong growth in certain south London areas, with Clapham (9.2%) and Balham (6.5%) – forever popular with aspirant, young professionals – leading the charge. North Kensington (5.1%) also enjoyed solid price growth on a year-on-year basis.
David Brown, CEO of Marsh & Parsons, commented: “With property investors frontloading their transactions into the first quarter of the year, activity was always likely to take a slight step back in the second quarter and so it transpired. Q3 is unlikely to see a marked uptick in values or transactions as we enter a traditionally slower season that sees individuals more preoccupied with holidays than houses, but is reassuring that the UK’s decision to leave the EU isn’t having the immediately negative impact that some doom-mongers predicted. Indeed, with the Bank of England reducing interest rates to a new historic low, mortgage finance will continue to be accessible, with pricing as attractive as it ever has been.“
