Covid-19’s effect on the top end of London prime property
You are listening to GARY HERSHAM. With over four decades of experience at the top end of the market, Gary is our go-to man for hefty price tags, thinking outside of the box & the ability to connect with anyone on the planet. There is very little that he cannot access on the buying & selling side.
the podcast
the transcript
the podcast
the transcript
Unknown: 0:01
Hello and welcome to the London property podcast the home of super prime. Today we’re in conversation with Gary Hersham, one of London’s leading agents, who’s managed to do a deal for over 200 million this year in 2020. Welcome, Gary. I started beach mistakes in probably 1978. And that was a function of having left University having done my undergraduate degree. And having started my postgraduate degree, which I found rather boring. And I’d worked for my late father in one of his three public companies, a friend of mine came up for tea in house in St. John’s wort and suggests the joint is a state agency, and I became a partner with him. And that was in 1978, and not go into any great detail. By the end of the year, I owned 100% of each of the states. Last time I interviewed you was the day after Brexit. So can we have your Market Snapshot now? Not so sure. It’s so easy to give you a snapshot of them. It’s a very strange market we live in today, I don’t see that there are a hell of a lot of distressed sales is for sure very few people can come to England, and therefore the footfall into properties is much lower than it ever has been. We are still concluding some sales, but not with the speed and rapidity that we used to do them in the past. So a lot of interest in London, central London property, I think the safe haven label of UK or particular London is still there. But the ability to get people out of your property is very much more difficult than ever has been in the whole of my career. So do you think that actually, we might see a boost in activity once travel picks up? So actually, this is a period of time to try and transact, to get take advantage of people’s lack of confidence. If your question is such that you suggest that in this injury market, so to speak, people will trade at lower prices and they would have beforehand. Not sure you’re right. I’m not sure that there are a lot of people who are ready to trade at discounts. Those who are trading at discounts are forced to trade discounts. And it’s mainly because that particular property is in the hands of the receiver, or there’s something wrong with the property. In other words, it was refurbished badly. The gearing was wrong, the interest rate was wrong. And as such those properties would be distressed in any market, let alone this market. Having said that, there are sales of taking place today. People are coming to view but with with reticence. People don’t feel comfortable going into houses where you’re setting your house for an owner occupier, where you’re selling a house run by the owner occupier himself doesn’t want a lot of people coming through at the same time he wants people to wear masks. It’s all a very uncomfortable situation. But there is still business out there. But sadly, not as much as there was beforehand. Are you seeing a difference in the profile of the buyer? Do you think that they’re more domestic than than foreign? Was that just travelling? Well, clearly, people who are in England are the ones who can come out and see properties. And they might be English, they might be Russian, they might be Indian, they might be Chinese. But the real crux of the matter is the numbers are lower, very much low. And viewings and people are taking their time. You know what? I can’t find something today. I’ll find it tomorrow. So that’s what the situation is, in a sense of urgency. In some cases, there’s a sense of urgency. In some very rare cases, somebody wants to buy something immediately. But in most cases in Absolutely. Most cases, people are saying Don’t worry, we’ll find something sooner or later. So normally in the top parts of of the market, people hold up to get the price that they want. So are you finding that people are actually not bothering to put their bodies on the market right now? Is there a shortage of stock? b beach mistakes in this also in particular has over 100 instructions? So perhaps that answers your question. Right? And what’s the most expensive property on the market at the moment to your knowledge. We’ve got several country instructions, which are plus or minus 100 million pounds. My particular case in excess of 100 million pounds. There are several properties that I’m aware of that we’re instructing on in prime central London and around 60 million pounds. And of course, they’re they’re exceptional ones that are in excess of 150 million pounds. But that profile hasn’t changed because of the pandemic attack Are you seeing that these trophy homes are changing hands as frequently as they used to been a lot of very important sales in prime central London, during during this nine month period, there’s last night not period. What I wonder is whether the extra 2% stamp duty that comes in in April, the April coming will enhance the speed of transactions prior to that, because now there’s an extra 2% that comes along for foreign purchases in April. And I suspect many of them are aware of it. And they’ll want to complete their transactions before that to hit that extra stamp duty hits. Not only it seems to make a huge amount of difference to people spending 30 or 40 million quid, but everybody likes the idea of being able to save and not to have to pay that money, because it’s wasted otherwise. So normally London goes kind of through circle cycles, where the 70s you have people from the Middle East buying and then you have Russians buying and so on, what do you think is the profile of interest? Where is it coming from? Maybe China? Maybe China right now? And are you finding that the Chinese are buying for personal use? Are they making investments? Is it a bit of everything? What is your take on it? Well, I can see a lot of Chinese investment in prime central London, the top end of the market, not gonna mention any company names, but there are two or three very well known Chinese conglomerates, buying in the UK, both residential and commercial. From my point of view, I’m not talking about in the general market much more in the general market. And then the chairman of those companies buying their own residence in prime central London. In a particular case, we sold one of them a house for 210 million pounds in February of this year. Nice and simple single residence or small t units. No comment. So what do you so what would you advise if somebody came to you and said, Gary, I want to spend, I want to invest 20 million pounds today What to do? It really depends. It really depends what they tell me they want to invest in lots of people to say, I want to buy a vacant block of flats, but I can’t find many good, good value blocks of flats in prime central London stay. Yeah, please send it to me. The other inquiries, hotels, the amount of inquiries we get hotels is is almost exponential. And again, that’s a very difficult inquiry to satisfy. Very difficult from an agent’s protection point of view. Why an agent’s protection, because the minute you release the name of the hotel to your potential buyer, he has a way of going directly to source. That’s always been my concern. Unless you’re instructed on a solid agency basis, we’re quite often not instructed on such basis. So it’s a very brave asset class to be investing in when all the hotels are shut. Well, they’re all expecting 30 or 40% discount, so perhaps not as brave as you think it is. Okay, so they’re waiting for now, Donald Trump to graduate from his COVID school, something like that. Did he have COVID? Is it a political move? I think he didn’t want to face another debate, in my view. And what about Brexit? What do you think that’s doing to the market? Brexit is practically forgotten now. Nobody mentioned Brexit, anybody. Everybody’s worrying about masks. Everybody’s worrying about masks. I mean, this COVID business, nobody sees an end to it. Nobody sees how I work properly. No one sees how one can go out. And I mean, if you look at different parts of the world, Canada’s in lockdown, Israel’s in lockdown, the north of England is about to be in lockdown. What’s what people think after the first lockdown period worldwide, wherever it might have been Melbourne’s in lockdown. Everybody thought they’re infallible. Nobody can touch them, or something that powers the restaurants, the bars, the public areas were congested with people thinking to themselves, nothing can happen. All of a sudden the death rate shoots up or the the case rate shoots up. I think it’s very important to remember that this is a really serious life, health, life and death matter. And whether we joke about Trump or not. Anybody that’s it’s not cases. virus can hit anybody clearly. And I think we’ve got to take it very seriously. And this is what we have to worry about. How do we show properties? What’s going to happen to the property market? What’s going to happen to officers what’s going to happen to the retail market, what’s going to happen to the restaurant market that was going to go into an enormous its enormous crisis, but the crisis is going to get worse and worse and worse. We have to live through it. Guess what? We’re not here for today we’re here for tomorrow, we’re gonna you know what, this is the land of the living? Do you have any opinion on what what you think is gonna happen to the commercial market to the office market? What would you think would be a good decision? I think it’s important to remember that people need to associate with one another. There has to be interaction between people. Part of going to work is perhaps to get away from home part of going to work is to meet their friends. Part of work is working itself. But I think that that human interaction is terribly important to all of us. And I’m not so sure that given a little bit of time, the office market won’t properly recover. We hope you enjoy that. Thank you for listening to London property, the home of super prime, you can reach us by email info at London property.co.uk
Tags: London PropertyPrime property covidmarket update
Episode is Live
Published: Nov. 30, 2020 @ 9AM Edit
Unpublish
Transcript is Live
Delete this transcript.
Unpublish
Add Chapter Markers
Listeners can tap through & see what’s coming up.
Create a Visual Soundbite
Best way to share to social media for engagement.
Share Episode On
Facebook
Twitter
LinkedIn
More Options
Email Link to Episode
https://www.buzzsprout.com/1476448/6612019
Copy
Direct Link to MP3
https://www.buzzsprout.com/1476448/6612019-covid-19-s-effect-on-the-top-end-of-prime-property-gary-hersham-shares-his-opinion.mp3?blob_id=29152394&download=true
Copy Download MP3
Embed this ONE Episode
View Episode Stats
To connect with this expert, email ask@www.londonproperty.co.uk or if you are a member log in to connect with Gary directly by clicking on his profile on this page or via ‘Hire an expert’.
Subscribe to our newsletter
London Property brings you interesting, informative & educational content and connects you with the need-to-know experts in the best neighbourhoods of London.
Sign up to our newsletter to be kept informed as new content is released.
SUBSCRIBE