Regional and national data continued to show declining sales rates and falling prices until April 2009 and there was little positive media coverage on the market until May, when reports of “green shoots” in the London market started to appear in the press. It has often been the case historically that London in general, and central London in particular, is ahead of the wider regional and national markets in terms of market and pricing trends.

Against a backcloth of deepening recession, company failure and growing unemployment, The Bank of England’s Monetary Policy Committee made successive cuts of 0.5% points at its meetings on 8th January, 5th February and 5th March 2009. This took the Official Bank Rate from 2% at the end of 2008  to just 0.5% in March 2009, the lowest rate since records began in 1694. This had a significant impact on reducing the monthly repayments of mortgage holders with tracker mortgages, but with banks still reluctant to lend, it had little impact on the all important first-time buyers.

In Midtown, City and Docklands the resurgence in the market has been underpinned by buyers with significant equity stakes and outright cash buyers. The reduction in the Bank Rate was of only marginal significance to this group of purchasers. On the other hand the reduction in the Bank Rate to 0.5% by early March had a positive effect on general market confidence in Midtown, City and Docklands.