{"id":439811,"date":"2025-09-21T01:24:18","date_gmt":"2025-09-21T01:24:18","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/439811\/"},"modified":"2025-09-21T01:24:18","modified_gmt":"2025-09-21T01:24:18","slug":"how-to-profit-from-the-big-london-property-freeze-as-rumours-of-a-budget-tax-raid-bring-the-market-to-a-standstill-these-are-the-areas-where-brave-buyers-can-snap-up-huge-bargains","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/439811\/","title":{"rendered":"How to profit from the big London property freeze: As rumours of a Budget tax raid bring the market to a standstill, these are the areas where brave buyers can snap up HUGE bargains"},"content":{"rendered":"

From the Georgian squares of London\u2019s ritziest neighbourhoods to the blocks of flats on the outskirts, a cold chill has descended over the London property market.<\/p>\n

House price growth is dead in the water \u2013 at 0.7 per cent in a year, it\u2019s the worst performing area of the country, according to the latest official figures.<\/p>\n

In many areas of the capital, prices are plunging as desperate sellers slash asking prices in the hope of snagging a buyer. Sellers simply cannot shift their properties \u2013 and selling times are extending relentlessly.<\/p>\n

So what has killed off the market \u2013 and what will it take to revive it?<\/p>\n

BUDGET GLOOM\u00a0<\/p>\n

When speculation broke that Chancellor Rachel Reeves is considering a new property tax in the autumn Budget<\/a>, London\u2019s stuttering property market took a sucker punch.<\/p>\n

Reeves is apparently mulling plans to scrap stamp duty<\/a> and instead introduce a property tax on homes worth over \u00a3500,000.<\/p>\n

This would be payable every year at a rate set by the Government based on a house\u2019s value when it is purchased.<\/p>\n

\"Ladbroke <\/p>\n

Ladbroke Grove, price drop \u00a3425k: A one-bedroom top-floor flat in Notting Hill was listed in April 2025 at \u00a3875,000, and by July had been reduced to just \u00a3450,000. The flat is near to four Tube stations and four local schools<\/p>\n

As the average house price in London is \u00a3561,000 \u2013 double the national average, according to the Office for National Statistics \u2013 most homeowners in the capital would be hit.<\/p>\n

Buyers are sitting tight to see if the Chancellor goes ahead. After all, no one would want to fork out for stamp duty if it was abolished just weeks later in the Budget on November 26.<\/p>\n

Similarly, there is speculation that Reeves could remove valuable capital gains tax<\/a> relief on pricier properties.<\/p>\n

Capital gains tax is charged on the increase in the value of an asset when you sell it. It is applied to the sale of second properties, but not main homes.\u00a0<\/p>\n

That means that even if you bought your home for \u00a3100,000 and sold it years later for \u00a3500,000, you wouldn\u2019t pay any tax on the gain. If this relief was removed for pricier homes, sellers would face a bill on their gains.\u00a0<\/p>\n

The current capital gains tax rates are 18 and 24 per cent for basic and higher-rate taxpayers.<\/p>\n

Polly Ogden Duffy, managing director of agent John D. Wood, says: \u2018Buyers are just waiting it out until the Budget.<\/p>\n

\u2018There are vast amounts on the market, lots of properties have been devalued in the past eight weeks and the time between offer and completion is the longest I\u2019ve seen in my 22-year career.\u2019<\/p>\n

She adds that the market above \u00a31.5 million has been particularly affected. At the moment, stamp duty on a property selling for this sum would be payable at 12 per cent, or \u00a393,750, or \u00a3168,750 on a second home as stamp duty is higher \u2013 eye-watering sums deterring both buyers and sellers.<\/p>\n

ENTRENCHED PROBLEMS<\/p>\n

Fears over the upcoming Budget are the final straw \u2013 the London property market was already looking gloomy.\u00a0<\/p>\n

The abolition of the non-dom tax regime has led many wealthy residents to decamp to more tax-friendly jurisdictions such as Dubai, resulting in a drop in the number of buyers.<\/p>\n

\"Polly <\/p>\n

Polly Ogden Duffy, managing director of agent John D. Wood, says: \u2018There are vast amounts on the market, lots of properties have been devalued in the past eight weeks and the time between offer and completion is the longest I\u2019ve seen in my 22-year career\u2019<\/p>\n

Plus, property prices in the capital have become increasingly unaffordable, diminishing the pool of potential buyers.<\/p>\n

Richard Donnell, executive director at property website Zoopla, says: \u2018London\u2019s market has seen house prices underperform the rest of the UK for almost a decade. Higher mortgage rates<\/a>\u00a0since 2022 have increased affordability pressures.\u00a0<\/p>\n

Home values have been broadly flat in inner London, where the market relies more on international buyers.\u2019<\/p>\n

HEFTY PRICE DROPS<\/p>\n

Above \u00a35 million things are especially dire, says Camilla Dell of buying agent Black Brick Property Solutions. \u2018There\u2019s unprecedented supply in areas such as Mayfair, Belgravia, Kensington and Chelsea, Knightsbridge. This can only mean that prices will come down further.\u2019<\/p>\n

Prices in prime central London are already 22 per cent lower than their 2014 peak, according to estate agent Savills.<\/p>\n

The average price of a flat in prime central London this year so far is \u00a31,887,488, down from \u00a32,141,936 last year, according to the analyst LonRes \u2013 the lowest since its records began in 2013.<\/p>\n

Transaction levels are down<\/p>\n

10 per cent year-on-year and the average time on the market from launch to exchange is 324 days \u2013 the longest on record.<\/p>\n

Of the 102 properties for sale priced between \u00a33 million and \u00a38 million, 55 have been reduced in price, according to LonRes. Only eight are under offer, and all at below asking price.<\/p>\n

Charles Curran, managing director of Kensington and Chelsea estate agent Maskells, says: \u2018The usual buyers are simply not coming \u2013 or are leaving. Inheritance tax<\/a> on global assets [of the residence-based tax system that replaced the non-dom regime] was the nail in the coffin.\u2019<\/p>\n

Peter, a retired financier, has been trying to sell his two-bedroom flat in south-west London for a year. He has rented it out for 21 years, but now 74 he is keen for the funds. On at \u00a31,495,000, the flat received no offers, and dropping its asking price to \u00a31,395,000 in May made little difference.<\/p>\n

Says Peter, who lives in Jersey: \u2018The Government keeps messing around with taxes and the market is suffering badly. I\u2019ve got a lovely flat now at a very attractive price. I\u2019m not going to drop it to a price where we\u2019re giving it away.\u2019<\/p>\n

\"Greenwich, <\/p>\n

Greenwich, price drop \u00a3500k:\u00a0This four-bedroom townhouse in leafy Greenwich has gone from \u00a31.4 million to \u00a3900,000 \u2013 a 35 per cent drop (the first reduction was in May). The property also features a courtyard garden and is close to the local station<\/p>\n

As the owner of an unmortgaged property who can afford to sit it out, he\u2019s not alone, says Liam Monaghan of LCP Private Office, a buying agency. \u2018There\u2019s a big difference between want and need \u2013 and there are plenty of people just not selling. The market is suspended, rather than crashing.\u2019<\/p>\n

Overseas buyers are scarce. He has a few French buyers with \u00a31 million to \u00a35 million \u2013 along with some Americans \u2013 still moving to London for jobs in law or finance, and schools. Plus, there are opportunistic rental investors hovering.\u00a0<\/p>\n

\u2018An Asian client is looking for small flats between \u00a3400,000-\u00a3500,000 that can provide a 5 per cent yield after refurbishment,\u2019 says Monaghan.<\/p>\n

CHAIN-FREE BENEFITS\u00a0<\/p>\n

Domestic cash buyers are also flexing their muscles, says Scott Joseph of agent Anderson Rose, who says only two of 15 sales this year came from overseas buyers.<\/p>\n

One was a four-bedroom house in Connaught Village, a neighbourhood north of Hyde Park. The non-dom vendor had bought it in 2021 for \u00a33.25 million and put it on the market a year ago for \u00a33.65 million after deciding to decamp to Dubai.<\/p>\n

\u2018Not a dicky-bird, so in May the vendor told me they needed it sold within a month so we put it on at \u201coffers in excess of \u00a33 million\u201d and we got an offer for \u00a33.1million four weeks ago from locals keen to upsize,\u2019 says Joseph.<\/p>\n

A BUYER\u2019S MARKET<\/p>\n

There are still patches where properties are selling if priced well. The \u2018hottest\u2019 postcodes are SE2 (Abbey Wood\/Thamesmead), E18 (Woodford), E10 (Leyton), SE9 (Eltham) and E17 (Walthamstow), with 57-60 per cent of homes for sale under offer, according to data from the analyst PropCast.<\/p>\n

In contrast, the \u2018coldest\u2019 ones are EC2 (City, Hackney, Shoreditch), W1 (Mayfair\/Marylebone), WC2 (West End), W2 (Paddington\/Bayswater) and SW10 (Chelsea) \u2013 with only 8-13 per cent of homes under offer.<\/p>\n

\"Richard <\/p>\n

Richard Donnell, executive director at property website Zoopla, says: \u2018London\u2019s market has seen house prices underperform the rest of the UK for almost a decade\u2019<\/p>\n

The scales have shifted in favour of buyers. Ben, who\u2019s selling his four-bedroom house in Brixton, south London, has had \u2018pretty much nothing\u2019 since he put it on the market in May, despite reducing the price from \u00a31.1 million to \u00a31 million in April \u2013 after the stamp duty increases.<\/p>\n

\u2018We\u2019re frustrated at being in limbo \u2013 the house we want is not selling either,\u2019 he says.<\/p>\n

Faced with so much choice, buyers are being hyper-picky or vacillating, collapsing chains across the suburbs. \u2018Things thrown up on surveys are causing nervous buyers to pull out at the last minute,\u2019 says Gary Howorth of agent Chestertons. \u2018Vendors who will not take our advice to drop their price are losing out as their buyers move on to other properties.\u2019<\/p>\n

Flats in blocks are sticking on the market due to rising service charges. Howorth cites a flat selling at \u00a3450,000, where the service charge is up from \u00a34,500 to \u00a37,000 a year.<\/p>\n

Some frustrated vendors are changing tack. The last three two-bedroom garden flats at \u00a3600,000, \u00a3750,000 and \u00a3800,000 \u2013 have been transferred over to the lettings market, says Edward Dennett of Wilfords, a boutique agency, in Balham.<\/p>\n

\u2018The owners have all gone for a buy-to-let mortgage<\/a> [taking out a buy-to-let on the property while taking out a residential mortgage to buy another property],\u2019 he says.<\/p>\n

The average monthly rent for London, at \u00a32,712, has reached another record high, according to Rightmove Rental Trends Tracker.<\/p>\n

It\u2019s taken Kathryn, in Beckenham, south-east London, over a year to sell her four-bedroom home. On at \u00a3750,000 with John D. Wood, it finally sold two weeks ago at asking price \u2013 much to her relief.<\/p>\n

\u2018My first buyers fell through as the chain collapsed. Then I got another set and every document was scrutinised, which took four months,\u2019 says Kathryn, 46. \u2018For a year we\u2019ve been paying mortgage, insurance and council tax and I\u2019ve been waking up every day dreading it falling through again.\u2019<\/p>\n

It\u2019s the same for Harry, 39, trying to sell his two-bedroom flat in Brockley, south-east London, at \u00a3600,000, since March.<\/p>\n

\"Mayfair, <\/p>\n

Mayfair, price drop \u00a31,450,000: In the heart of London\u2019s exclusive Mayfair district, this luxurious three-bedroom apartment was listed in December 2024 at \u00a37,950,000 and has seen its value drop by 18 per cent to \u00a36,500,000<\/p>\n

\u2018We\u2019ve had lots of viewings, but buyers just disappear. One buyer got through to survey and solicitor stage but dropped out in April after realising stamp duty costs were too high,\u2019 says Harry, who works in marketing.<\/p>\n

Yet when the price is right, agents are reporting bidding wars.<\/p>\n

For Savills, the outperformers in their markets are the leafy, family-oriented suburbs like Putney (+2.5 per cent in the past year), Wimbledon (+3.4 per cent) and Brook Green (+1.3 per cent).<\/p>\n

In Earlsfield, south-west London, a four-bedroom home priced at \u00a31 million had 50 viewings and 19 offers, according to Robin Chatwin of Savills. Last month it sold for just over \u00a31.1 million.<\/p>\n

Lawyer Poppy, 47, is among those who has got an offer after changing estate agent. Her five-bedroom house in Wandsworth had sat on the market at \u00a31.8 million with no offers.<\/p>\n

\u2018A neighbour recommended Chelwood Partners, a small local agency. They said reducing it to \u00a31.75 million would bring a bidding war,\u2019 she says.<\/p>\n

In two weeks they got three offers and accepted \u00a31.77 million. \u2018We\u2019ve found our dream house, but then the bomb dropped about a new property tax. Why should we pay over \u00a3300,000 in stamp duty if the Government will do away with it? We are now in a quandary until the Budget.\u2019<\/p>\n

Across London, she\u2019s clearly in good company.<\/p>\n","protected":false},"excerpt":{"rendered":"From the Georgian squares of London\u2019s ritziest neighbourhoods to the blocks of flats on the outskirts, a cold…\n","protected":false},"author":2,"featured_media":439812,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7757],"tags":[748,393,4884,257,1232,1283,16,15],"class_list":{"0":"post-439811","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-london","8":"tag-britain","9":"tag-england","10":"tag-great-britain","11":"tag-london","12":"tag-money","13":"tag-thisismoney","14":"tag-uk","15":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115239680215557680","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/439811","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=439811"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/439811\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/439812"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=439811"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=439811"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=439811"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}