How’s the market?

Quarterly Insights by Hugh Obbard 18/06/2025

Up down, round and round; finding direction and rich opportunities amidst conflicting signals.

Making sense of the UK property sector is invidious at the best of times. But for those training their lens on Prime London this summer, arriving at a meaningful verdict on the state of things is an even bigger ask. The capital’s most sought-after postcodes are entirely distinct – inherently more nuanced than any others in the land – so even after 30+ years in business here, I still swallow hard when asked the simple question: “So, how’s the market looking?”

In January I ventured the prediction that 2025 would live up to its Chinese designation as the Year of the Snake – “a period of rebirth and transformation”. Some things we knew or could confidently predict: cautious and incremental downward movement on interest rates from the Bank of England, the watering down of tax changes for non-doms, a tentative return to growth for the UK economy overall.

What we could not so easily have foreseen, however, was the disruption unleashed by the new US administration. These are still early days for Mr Trump’s tariff-driven trade policy, but its transformational impact is already being felt. The US is odds-on to be touched by recession this year, while the world’s other major economies adjust to the apparent New Normal – striving in their own ways to avoid similar contractions.

All of which means that passing judgment on the prospects for Prime London this summer is more speculative than ever. Yet as a company operating uniquely across all property specialisms – from first investment to portfolio and asset management, design and build, sales and lettings – perhaps a few instances on some of Obbard’s own recent activity is actually as good a means as any to gauge the ebb and flow of this most particular market.

I offer the following selected examples from the past month or so in the hope that you can draw some useful conclusions from these conflicting signals. Our design/build activity is extremely busy but explaining the ups and downs and challenges of that world is best for another post, on another day.

Contradictions in Sales: Premiums Achieved and Discounts Accepted

Sales dynamics reveal a divided market sentiment where sellers can still realise premium pricing, while savvy buyers concurrently can capitalise on attractive discounts.

We sold a £10m+ house in a Kensington square—originally acquired for clients in 2011—at a record price per square foot for the location.
A £30m+ trophy asset we developed in a truly Prime London address sold at a 16% premium to asking price.
We sold a 2/3-bed Notting Hill flat for 5.5x what we paid in 1999
We sold a similar sized 2/3-bed apartment in Chelsea at 11% below what we had bought it for in 2014.
We agreed to purchase a £5m+ house in South Kensington at 10% below its 2014/15 peak value
We narrowly missed out on an unmodernised penthouse in Knightsbridge (on the market for a year, reduced from £6.5m to £4.95m) after bidding close to 20% below asking.
We offered 30% below asking on a pair of dilapidated Hampstead houses—still under negotiation with the bank in possession.
Meanwhile, we secured a large unmodernised Notting Hill flat at 25% below its original asking price (12% below the latest quote).

Viewings: Strong Demand in Some Pockets, Silence in Others

Viewings remain uneven across the market, with strong interest in select prime properties contrasted by minimal activity in nearby, comparable listings.

We’re marketing a 2-bed, 2nd-floor Knightsbridge flat (no lift) for £2.75m—8 enquiries over the past month and strong interest.
Yet a very similar 2-bed, 3rd-floor property (with lift), only 500 metres away, at £2.85m has had zero enquiries in the same period.
A £12m house in South Kensington drew 8 viewings this month, while a £1.5m flat in Bayswater saw just one.

Lettings: A Story of Highs and Holds

Lettings show a mix of strong growth in prime assets alongside steady, stable rents across the broader portfolio.

A Notting Hill property was agreed at £43,000 per month—14% higher than two years ago—with two other parties competing.
Everything else in our portfolio (average rent ~£7,500/month) was also let this month—at a negligible overall uplift on 2022 levels.

Global Market Sentiment: A Mixed Bag

Global market sentiment remains mixed, with cautious investors in Asia contrasting sharply with confident, active buyers in Dubai and Monaco’s growing interest in UK opportunities.

Starting the year with a trip to Hong Kong and Singapore in February, we found investor sentiment toward London was cautious—buyers wary and holding back.
In contrast, Dubai in May was buzzing: buyers were active, confident, and ready to transact.
A short trip to Monaco in between revealed plenty of dry powder—capital ready to deploy—and a strong focus on the UK. Watch this space.

In short: yes, it’s a complex market. But it’s also an active and nuanced one—and one of the most challenging, yet opportunity-rich periods we’ve seen at Obbard.