London real-estate agents have begun to offer free cars worth £18,000 (US$23,369), stamp duty subsidies of £150,000, and free Apple Inc iPads and Sonos sound systems to boost sales in the British capital’s increasingly moribund property market.
The once super-hot central London market has turned into a “burnt-out core,” buying agents Garrington Property Finders Ltd said, prompting developers to offer ever-greater incentives to lure buyers.
At one development in Muswell Hill, a relatively affluent part of north London, sales agents last week said they would be giving away a Renault Zoe electric car, priced at £18,045, to every buyer.
Photo: Bloomberg
They said they would also pay stamp duty on the £1.99 million homes, at £153,000.
Apart from the free prosecco and gourmet pizzas available to people viewing the properties, anyone willing to put down a £2,500 deposit at the development’s launch night would also walk away with a free iPad, they said.
The developer, Jamm, says that sales are robust and that “this is absolutely not a sign of desperation.”
“There is a lot of nervousness out there with the election and Brexit, and buyers are looking for excuses not to buy. We’re giving them reasons to buy,” Jamm director Tim Jackson said.
Free furniture packages worth up to £20,000, John Lewis vouchers and free three-year travel passes have all been offered to potential buyers in other developments across the city.
Property agent Henry Pryor said that there is a pipeline of 59,000 high-end apartments under construction in London alone, yet annual sales of new flats in the city are only 6,000.
“Developers will sell their first-born to shift them. It’s last-chance-saloon stuff. About the only incentive they have not tried is a BOGOF [buy one, get one free],” Pryor said.
The developer behind the giant Battersea Power Station development of 4,360 apartments in south London last week slashed its profit forecasts amid rising costs and wider economic uncertainty.
House prices have begun to fall nationally — Nationwide Building Society said typical prices fell in both March and last month — and the steepest drops have been seen in London.
UK Land Registry figures show that in the heart of the city’s financial district, average property prices plummeted from £861,000 at the time of the EU referendum in June last year to £773,000 in February, a decline of 15 percent, although in London’s outer boroughs prices are still up over the year.
Transactions — the lifeblood of real-estate agents, who rely on turnover rather than high prices to make money — have also fallen steeply.
Garrington said the “hipster hotspot” of Hackney last year saw sales collapse by more than a third and there have been few signs of a recovery since.
LCP Management Ltd, a property investment company, blamed big hikes in stamp duty for a collapse in sales.
It said that in central London, sales of new flats were down 41.4 percent in the last three months of last year compared with the previous year, while average prices fell 8.7 percent over the same period to £1.9 million.
Chinese buyers had melted away, Pryor said. “The Chinese are finding it more difficult to borrow from their own banks and the gloss has gone off the London market. Foreign buyers were a very significant part of the new-build market, but they can’t get a yield, and they now can’t flip them for capital gain.”
Pryor said it could be years before prices for new-build flats start rising again. “If you could short new-build property, then you would make a mint, but there’s no market. In my 28 years in the property business, we have done this twice before and each time it takes around five to seven years before things recover.”
However, tenants are winners from the post-Brexit decline in the property market. Rents in London have fallen sharply, with new tenants in the city typically paying almost £100 per month less than their counterparts a year ago.
The average monthly rent in the capital dropped from £1,297 a year ago to £1,203 in March, said Your-move.co.uk Ltd, which publishes a regular buy-to-let index.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
PRESSURE EXPECTED: The appreciation of the NT dollar reflected expectations that Washington would press Taiwan to boost its currency against the US dollar, dealers said Taiwan’s export-oriented semiconductor and auto part manufacturers are expecting their margins to be affected by large foreign exchange losses as the New Taiwan dollar continued to appreciate sharply against the US dollar yesterday. Among major semiconductor manufacturers, ASE Technology Holding Co (日月光), the world’s largest integrated circuit (IC) packaging and testing services provider, said that whenever the NT dollar rises NT$1 against the greenback, its gross margin is cut by about 1.5 percent. The NT dollar traded as strong as NT$29.59 per US dollar before trimming gains to close NT$0.919, or 2.96 percent, higher at NT$30.145 yesterday in Taipei trading