- Sales fell 15% June through August from year earlier
- Average prices in prime districts dropped 4.4% from 2014
Luxury homes in London are proving the toughest sell since the global financial crisis as higher taxes continue to damp demand.
In the city’s prime central districts such as Notting Hill and Knightsbridge, 814 existing homes sold in the three months through August, a 15 percent decline from a year earlier and the lowest for the summer since 2008, according to broker Huntly Hooper Ltd. The average price fell 4.4 percent in August from a year earlier to 1,426 pounds ($2,216) a square foot.
Sales of luxury homes have been stymied since Chancellor of the Exchequer George Osborne increased the stamp duty sales tax for the most expensive homes in December. The tax escalates to 12 percent on every pound a buyer spends above 1.5 million pounds, with the purchaser of a 5 million-pound home paying 513,750 pounds in duty, almost 164,000 pounds more than before.
“Buyers are looking for options where they can enhance value through refurbishment to get back some of the costs associated with buying,”
Oliver Hooper, a director at Huntly Hooper, said. “It’s a much more level playing field between buyers and sellers.”
Prices fell 4.6 percent in Notting Hill and 2.4 percent in Knightsbridge in the year through August, according to broker Knight Frank LLP.