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4 min read

November 2023 | Market Update 

London property market sales trends in the third quarter of 2023 mirrored those witnessed earlier in the year. This resulted in lower property valuations and transaction numbers. On the lettings front, while supply progressively recovered, demand remained strong, particularly for more affordable properties.

According to the August RICS survey, demand continues to fall behind supply, implying that price declines and lower activity will continue for several months. According to the poll, more surveyors reported price drops in August than at any other time since 2009. However, there is a better medium-term outlook characterized by economic stability.

Looking ahead, there is optimism that, despite ongoing economic uncertainty and increased mortgage rates, additional price falls will be restricted because of the existing short fall of good quality properties and the moderate growth seen over the last decade.

Sales activity was impacted more than property values, with transaction volumes significantly down compared to the higher sales markets of 2021 and 2022. The market for homes priced at £5 million or more also saw a drop in activity from previous highs.

For the Prime Central London sales market, weak demand continued to contribute to a drop in property values and transaction numbers. Despite the traditional autumn selling season starting in September, sales activity remained low, with a 23% reduction in sales compared to the previous year. When compared to the pre-pandemic period, current transaction levels are not dramatically different, standing 5.7% higher than the 2017-2019 third-quarter average.

Despite decreased sales, new instructions increased, resulting in a 20% increase in available property stock over the previous year. The significant increase in price reductions, up 91% from the previous year, can be attributed in part to the increased quantity of residences for sale.