London house market set for £52bn post-lockdown splurge as transactions stall
The figure represents the potential spend for residential buyers and marks a 20 per cent increase on the same time last year.
It comes as the number of lost house sales in the capital continues to increase as a result of Covid-19, according to new figures from Knight Frank.
While four in five deals underway when the pandemic struck are still progressing, transaction numbers in the week ending 2 May were 54 per cent below their five-year average.
However, data on new buyer registrations suggested that people are starting to prepare for life after the lockdown.
In the week ending 28 March registrations were 77 per cent below the five-year average for London. By 2 May this narrowed to a decline of 60 per cent, while the number of new prospective buyers doubled over this period.
Meanwhile the number of online searches for sales properties in the capital was just 12 per cent below the five-year average at the beginning of May, compared to a 42 per cent decline in the first week of lockdown.
While the slowdown is likely to lead to a decline in prices, this will be mitigated by a fall in supply, which fell more than demand every week in the four-week period to 2 May.
“That said, the difference between asking prices and exchange prices is widening,” said Tom Bill, head of London residential research at Knight Frank.
“In April 2020, the average sale price was 94 per cent of the original asking price, down from 97 per cent in January, which was a time when the effects of the so-called Boris bounce started to take hold.
“This reflects the ad hoc renegotiations that are taking place between buyers and sellers, which are not based on comparable evidence.”
Knight Frank’s prime central and outer indices were roughly flat year on year in April, which it said reflected “thin” trading conditions.
Figures released last week by Halifax revealed UK house prices fell 0.6 per cent in April compared to the previous month, dropping to an average price of £238,511.
However, property experts said buyers and sellers will return “in droves” once the lockdown has been lifted.