House prices London UK experience biggest drop over the last year
According to House Price Index from the Land Registry, house prices London UK have experienced the biggest slump in property values over the last year
The combination of Brexit and General Election have weighed on the market as house prices have slumped by 0.2 per cent across the UK since August, while house prices London UK have experienced the biggest slump in property values over the last year, according to September’s House Price Index from the Land Registry.
House prices London UK suffered the biggest September drop in the UK.
Traditionally a premium property market, house prices London UK fell 0.4 per cent year on year in September compared to house prices’ average increase of 1 per cent in England.
Despite the fact that London was among the two regions across the UK which saw a drop in average house prices in the last year, it retained its position as the most expensive place in the country to buy a property. While UK house prices’ average value ticked up to £250,677, the average cost of a home in the capital still stands at a whopping £475,000.
Although, a detached home in the capital still typically costs over £898,000, this is 1.6 per cent lower than a year ago.
However, the decline in house prices London UK has improved slightly, with prices fell by 0.4 per cent in the year to September, a month earlier they were down 1 per cent.
Debapratim De, an economist at Deloitte, said “Today’s house price data show the London housing market continues to be afflicted by uncertainty over Brexit – which, combined with a slowdown in hiring, makes an immediate recovery seem unlikely.”
Although, the prime central London property market may be set for a rebound, growth in house prices in other parts of London is expected to lag behind the rest of Britain.
The price of luxury property in London is expected to rise after a prolonged spell of sluggish sales and discounting and set to climb 20.5 per cent over the next five years.
According to the Savills annual housing market report, prices will nudge down two per cent in the 12 months to this December. However, next year, there will be the first annual price rise of three per cent for high-end homeowners in London since 2014.
“Historically, a recovery in the luxury markets has been sparked in prime central London, when the city’s most expensive properties start to look good value on a world stage, “says Lucian Cook, head of residential research at Savills.
“Values have been bottoming out over the past year, resulting in a build-up of new buyer registrations over recent months. This signals that the market is set for a bounce, but this is still being held up by uncertainty.”
Property values are predicted to rise six per cent in 2021, four per cent in 2022 and 2023, and two per cent in 2025 in the capital’s exclusive locations of Belgravia, Knightsbridge, Mayfair, Kensington and Chelsea, Marylebone and Notting Hill.
Boroughs in east London were the best performers over the past year, led by Tower Hamlets where asking prices were up 3.5 per cent to an average of £592,000, followed by Waltham Forest, Bexley, Hackney, and Havering, which saw modest annual price growth, along with those in Southwark and Sutton.
Two thirds of the capital’s boroughs have seen prices decline in the past 12 months, led by three leafy south-west London boroughs: Richmond upon Thames (down 6.1 per cent), Kingston upon Thames (down 5.9 per cent), and Wandsworth (down 4.5 per cent).
Over the past few years, prices of properties worth more than £2.75 million were slashed by a fifth due to a hike in stamp duty on multi-million pound homes and Brexit-related uncertainty.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “London is still seeing the lowest annual growth in prices as the capital falls more into line with the rest of the country. While this is welcome for those trying to buy in the capital, let’s not get carried away as it is still difficult to afford property in London and the south east.
“Lenders are doing their bit, keen to lend and offering ever-cheaper fixed rates but finding the necessary deposit is often the issue, which is why the Bank of Mum and Dad remains so prevalent.”
As for the rest of the UK, there was an annual house price rise of 1.3 per cent, revealing the average property price to be £234,370.
The biggest monthly price rise was recorded in the south-east, with property values in the region up by 1 per cent between August and September.
The biggest plunge in house prices was seen in East Midlands as house prices fell by 1.2 per cent during the month.
In terms of annual figures, the North West saw the biggest annual prices rises, recording growth of 2.8 per cent and house prices in the region are predicted to grow six times faster than in London over the next five years.
The number of properties put up for sale in Britain has fallen by the most in any month in more than 10 years as the combination of Brexit and an election weighs on the market.
According to property website Rightmove, the number of properties put up for sale in the four weeks to November 9 were 14.9 per cent less than the number of properties on the market for sale during the same period last year.
That was the biggest annual fall in house prices since August 2009, shortly after the global financial crisis.
This hold-back attitude of potential sellers may be due to the General Elections as sellers adopt a wait-and-see attitude toward the outcome of the elections. They may be waiting for the next government and its impact on the legislations and if it reforms the stamp duty tax on property transactions as it may reduce the cost of buying a new home, according to the property website.
The rise in the price of properties also varied based on the type of property, with the cost of semi-detached properties rising more than the detached properties in the last year. While the price of semi-detached homes has risen by 1.3 per cent than they were a year ago, the average price for detached homes has risen by 0.5 per cent, and the price of flats increased by 0.9 per cent in the last year.