London is a ‘strange market’ filled with people living in unsuitable properties

It is undoubtedly a buyer’s market in London at the moment, with those who are looking to buy prime property in the capital having become intensely price-sensitive and pragmatic, expecting vendors to be more realistic about asking prices, or be prepared to negotiate, in order to achieve a sale.

But while some committed sellers now understand the need to factor in both the additional stamp duty and economic uncertainty into their price expectations in order to attract cautious purchasers, a number of price-sensitive vendors would rather withdraw their home from the market, or simply not list their property for sale at all, if they are unlikely to achieve their bottom-line price.

Some 58% of properties taken off the market in central London so far this year were withdrawn rather than being sold, according to data from LonRes, a research firm, which is not just restricting supply for prospective purchasers, but also much needed stock for estate agents to sale.

“This gives you an idea of just how sluggish the market is,” said Marcus Dixon, head of research at LonRes. “There are large numbers of people in properties they would really rather sell.”

But the level of withdrawals is “an important barometer of the market”, according to Dixon, who points out that a lack of forced sellers have not been accompanied by a sharp deterioration in the economy, unlike during the 2008-09 crash.

“The housing market has slowed considerably but not a huge amount of people are losing their jobs or finding themselves unable to pay their mortgages,” he said.

“It creates a strange market in which lots of people are staying in properties that aren’t very suitable for them anymore.”