Repossessions on the rise

In recent months we’ve seen a noticeable increase in repossessions across Belgravia, Knightsbridge and Mayfair, and this could rise further as properties are brought to market by administrators handling the collapse of specialist lender MFS.

Ownership in these neighbourhoods is typically more discretionary and hands off, versus domestic and family-led markets such as Kensington, Notting Hill and Hampstead.

Belgravia, for example, is currently seeing around three times the usual level of repossessions, notably at the top end of the market. Recent examples include properties priced between £10m and £50m, which are not compromised assets – some are high-quality, well-located homes in excellent condition.

Higher interest rates and a significant reduction in mortgage products is also contributing to this, and those who have been putting off re-financing or locking in mortgage agreements in principle (AIPs) are now having to act swiftly. Stricter anti-money laundering rules are also causing problems for some.

For buyers, this is creating some compelling opportunities where owners are motivated to secure a quick sale. However, it would be a mistake to assume every seller in prime central London whose property has been on the market for a long time is distressed. There are still plenty of wealthy sellers who have no borrowing and who are perfectly willing and able to hold out for their desired price or withdraw from the market if they don’t achieve it.