The once mighty London property market has been laid low and its house prices are now the weakest in the UK, the Nationwide has revealed.
Its latest index reports that prices in the capital have fallen for the first time since 2005 and are currently down 0.6% year-on-year on a quarterly basis.
Nevertheless the years of double-digit growth are still there to see. The average price in London is £471,761, more than twice the national average of £210,982.
“The softening of prices was initially led by the capital’s prime market, which was knocked sideways both by Brexit and in the wake of the introduction of higher rates of stamp duty for high-value homes,” says Nicholas Finn, Executive Director at Garrington Property Finders.
“But it is now spreading from the central boroughs – which saw prices rise fastest during the boom – to other areas where the growth came later.”
Despite London’s problems, across the UK average house prices are relatively stable, rising by two percent year-on-year and Nationwide says housing market activity overall – including mortgage approvals and housing transactions – has “strengthened a little”, it says.
naea |propertymark agrees with this analysis, revealing in its latest figures published today that the number of properties on the market has “increased marginally” with an additional two properties available for sale within each member branch, but Its Chief Executive Mark Hayward (pictured, left) says this isn’t “remotely enough to start to close the gap between supply and demand”.
Robert Gardner, Nationwide’s Chief Economist (pictured, right) says: “Low mortgage rates and healthy rates of employment growth are providing some support for demand, but this is being partly offset by pressure on household incomes, which appear to be weighing on confidence,” says
“The lack of homes on the market is providing ongoing support to prices.”