Forced sales to energise London market

The current stand-off between house buyers and sellers in the London property market will start to break as forced sales begin to appear in many areas, according to Cluttons.

Financial constraints are the early driving force behind many forced sellers, as fixed-rate mortgages finish and City pay rises fail to come to fruition. Those who have overstretched in order to secure their mortgage are increasingly feeling the pressure, with current unemployment fears adding to market jitters.

Sales of second homes are also set to increase at reduced prices, as owners draw in their finances and sell before the market slips further. The estate agent reports that this could lead to a much needed injection of energy back into the market, with those forced to sell offering appealingly low prices to buyers who have been prepared to bide their time to secure the best deal.

Richard Cotton, senior partner of Cluttons, said: “Forced sales will inject some energy into the market and will break the current deadlock between buyers and sellers. A more sensible price achieved through a forced sale can set a benchmark for home values on a whole street in London.

“This will allow anxious sellers who need to strike a deal and desperate buyers who have been trapped by high prices, a chance to go ahead with a purchase.”