The market is going to continue to be strong. In particular, prices at the top end are going to keep rising. However, the lower and middle markets are beginning to show signs of being price sensitive and the rate of growth there is going to slow down fairly dramatically over the next 18 to 24 months. This applies to new homes sales too. The recent government measures are going to result in more land coming to the market rather than less and these impositions are going to get more onerous rather than less.
A lot of developers recognise that they would be better negotiating with local authorities rather than have things imposed on them. It will push up values of well established areas, where there is no more development land so there is no danger or opportunity to have social housing imposed on them. It will make these areas more desirable. The top end of the market will get stronger. There is a lot more money being generated, more companies are being sold, people are inheriting valuable properties and the product is scarce, so prices are sure to continue upwards.
As far as London property goes, the supply has dwindled a little bit, partly because with the market picking up over there, selling agents don't have to put their properties on the market here. The demand is still there, however. We are also seeing an increased demand for homes abroad and this will continue to be a feature of the market. Spain and Portugal are the most popular.
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