MIDTOWN AND CITY BOUNCE BACK, DOCKLANDS STABILISES

In the first half of 2009 there was compelling evidence from the Midtown, City and Docklands residential property markets that the market had turned, with sales volumes and prices rising quickly between March and June 2009. This dramatic turnaround was quite unexpected. Our own forecast, made in December 2008, was for a further 5% reduction in sales prices in the first half of 2009, with prices predicted to stabilise in the second half of 2009. This was, at the time, a more optimistic forecast than other market commentators.

The rate of sales remained low in January and February 2009, but prices were stable in Midtown, City and Docklands. From March 2009 onwards, however, the level of activity in the sales market steadily increased in all three sub-markets. The impact of this was to increase sales prices in Midtown and the City and to maintain prices in Docklands (Figure 1). To summarise, in the first half of 2009, residential sales prices increased by 5% in the City, 2% in Midtown and there was no change in prices in Docklands.