Many happy returns to NVP
While there might not be a great deal to celebrate as we live with a pandemic, this week saw the sixth anniversary of Nic and Patrick founding Nicolas Van Patrick. Given what has been thrown at us during that time, that we are still here, and remain optimistic for the future, it feels right to acknowledge the occasion.
It has not been an easy ride thus far but it has been an incredible one, full of satisfaction and fun. There have been challenges galore, including stamp duty hikes targeted at the top end of the housing market, the Scottish independence referendum, the on-going Brexit debacle, Coronavirus, and President Donald Trump to name but a few. We have managed to survive it all, which is why we remain positive about the prospects for PCL.
The mini-bubble that the housing market is experiencing is not uniform with a very different picture in PCL to the rest of the country. Transactions are starting to happen again but while outer prime, such as Wandsworth and Putney, the country and Scotland are seeing plenty of activity as people move for gardens and more space, PCL relies on international buyers. People tend not to buy houses and flats in Knightsbridge and its environs out of necessity – ours is a much more discretionary and yes, fickle market.
In Knightsbridge, the property market has been hit hard by the inability of international buyers to travel. We have properties which would have sold under normal circumstances but are taking longer because relatively few domestic buyers can afford them. The Chinese have been our biggest buyers over the past few years but they haven’t really been in town because of quarantine at either end. Likewise, Middle Eastern buyers can’t get here.
There is always a market but because it is mainly domestic or international-domestic, buyers must perceive they are getting value. Subsequently, there is activity where there is good stock and it is well-priced. For example, we made a strong reduction on one property in Ennismore Mews that had received limited interest since it was launched just after lockdown lifted. The phone started ringing straightaway once the price was reduced, with domestic buyers showing an interest.
Likewise, we are about to exchange on another property in Kingston House South, which was reduced by nearly £500,000, again after little action. The price reduction has generated some traction and more than one bidder.
Pricing can be a thorny issue but we maintain you can never undersell a property if you market it correctly. Price it right, reflecting its true value, and buyers will compete. If you overprice, there is a risk the property will stagnate. Buyers will then think something is wrong with it, when actually it is only the price.
In the build-up to Christmas we tend to be busy with deals, and it is not unthinkable that this will happen again this year. We started seeing green shoots of recovery towards the end of the fourth quarter of last year and the first of this one, with many foreigners wanting to step into the UK market before Coronavirus put a halt to that. We remain positive about PCL – we have been talking to a lot of Pakistanis and Lebanese about London, and there are always people who need to move capital and see London as a safe bet for their future. The fundamentals are still there. Once we get the American election out of the way and the issues with the EU are sorted, the picture will be clearer and those who have already done their FX trades and have been sitting on the side-lines for a while, will come in. The 2 per cent stamp duty surcharge for overseas buyers from April may also focus the minds of buyers to get something done before then.
Meanwhile, we are tucking away the deals where we can, which we will take every day. The buyers we have are committed. We believe it is important for our business to keep talking – Zoom may have soared in popularity in recent months out of necessity but there really is no substitute for getting out there and meeting face-to-face. We are positive for the future. Here’s to the next six years – and hopefully beyond.