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Estate agents are pinning their hopes on a surge in activity over the winter as City bankers plough lavish bonus payments into the housing market.
Upmarket firm Savills today said interest in homes worth up to £5 million is growing as high-flyers plan what to do with bumper payouts, just a year after the financial system teetered on the brink of collapse.
However, agents said that City buyers are more cautious than in previous booms having been scarred by the recent turmoil.
There has also been an upturn in the buy-to-let market where demand among landlords for houses — but not flats — is on the increase, according to the Royal Institution of Chartered Surveyors.
James Morrison, who works for Savills in its Wimbledon sales office, said: “The City buyers are more likely to begin their search in about four to six weeks' time with a view to buying when their bonus is paid early next year. I think this year the City buyers will be a little more cautious.”
Charlie Bubear, in Savills's Knightsbride office, said: “There's a sense that this money is coming but nobody is spending it yet. There are definitely more bankers out looking but I am yet to see my first Goldman Sachs buyer.”
Reader views (6)
"Moderate house price inflation with full employment is no bad thing"
But we dont have full employment, Matt. And you are wrong about house price inflation too. it is a cumulative effect. Don't try lecturing your betters Mattie
- Keith Price, Luton England
So while others are struggling to pay their mortgages, bankers are living off the earnings of taxpayers to snap up parts of Belgravia. Nice!
- Simon, London
Why don't they invest their own money in stocks, shares, bonds and the financial products they are so keen on everybody else buying from them?
They just can't spend it fast enough on property, and anything else so long as it's not connected to their own financial products in the City.
- Kate, London
Bank bonuses do not cause house inflation Keith, they cause an uptick in the higher end of the market yes but does it have a knock on effect to your average 2-3 bedroom semi in the 'burbs? no it doesn't, I wish it did. As for house price inflation causing a recession, you are wrong on that score also. Moderate house price inflation with full employment is no bad thing
- Mattk, Ware
If Goldman does eventually pay out in 2009 bonuses to its London-based employees what it indicated last week HM Revenue & Customs stands to pick up £2 billion of it. That is £2 billion that the goverment will not need to grab from the rest of us; and given the shortfall between tax revenues and public expenditure as the recession continues, you might think that the general public would be more grateful.
- Matt, London
Why pretend that these bonuses are a good thing for the economy when they plainly are not. House price inflation is what this country cannot sustain. It raises false hopes and fuels a second recession
- Keith Price, Luton England
