A Government move to help first-time buyers appears to have backfired. The stamp duty deadline caused a mini boom in demand for property. This squeezed out first-time buyers but it was most profoundly felt in the market for London's more expensive houses.
That is the conclusion of research by eMoov.co.uk. It found that demand for prime central London property exceeding £1 million soared by 16 per cent in the run-up to April.
Despite the slow decline of London's high-end market during 2015, demand for property in prime central London was resurrected ahead of April's stamp duty changes, which saw both overseas and domestic property buyers charged an additional three per cent in stamp duty tax on the purchase of a second home.
Maida Vale, for instance, saw demand leap by 281 per cent since the start of 2016. In Primrose Hill, demand went up 169 per cent and in Chiswick it rose by 128 per cent.
Mayfair saw the lowest rise at five per cent and, in Notting Hill, demand dropped by 42 per cent.
EMoov records a 119 per cent rise in property prices over £1 million in St Johns Wood, where Beauchamp Estates is currently asking £6,995,000 for a house in the area known as the "Artists' Quarter".
Number 6 Greville Place is a double-fronted grade II listed house offering more than 5,000 sq ft of space. Built in 1819, it has six bedrooms, a double garage and off-street parking and mature gardens.
Greville Place and the surrounding area previously belonged to the Eyre Estate and were later developed by architect and builder Francis Armson, who was also responsible for some of the development of Abbey Road and Blenheim Road.
The then-relatively-inexpensive villas in this part of north west London attracted many artists.
Sculptor Gilbert Bayes, who lived next door at number 4, designed the Selfridges clock, which hangs above the main entrance of the Oxford Street department store.
The effect of the April stamp duty deadline may have delighted sellers but for prices it has been disastrous. Estate agent Knight Frank revealed in its latest prime central London sales index (covering March) that asking prices tanked in some of the capital's most prime areas.
Prices had been increasing at a
rate of nearly 3.5 per cent in March 2015. By March 2016, that had fallen to one per cent.
The main effect of the stamp duty hike has been to anger estate agents. Halah Kalakeche of Rescorp in St Johns Wood says: "The additional stamp duty levy of three per cent on investment properties has been devised to raise more money for the treasury and to attempt to slow down recent price rises in London. The ultimate aim is to assist people on to the property ladder as opposed to limiting them to being perpetual rent payers.
"While it will raise money for the treasury I fail to see how it will effectively help first-time buyers and cannot find any plausible reason for the policy."
Perhaps the Government plans for the effects of the stamp duty rise to be seen now, after the deadline.
Paul Smith, CEO of Haart estate agents, reports that first-time buyer registrations are up 22.7 per cent year on year.
He says: "For first-time buyers the next few months are a good time to buy - particularly now they are no longer competing with buy-to-let investors after the stamp duty surcharge that came into effect at the beginning of this month."