Prime London house prices fall at fastest rate in seven years
11-09-2016
Chelsea records a ten per cent drop in October while rest of UK sees property market return to form after Brexit vote
Prime London house prices fall at fastest rate in seven years
London's prime central housing market is falling at its fastest rate in seven years, according to estate agents Knight Frank.
Prices in the most expensive boroughs fell by 2.3 per cent in October, reports Reuters, the biggest drop since the same month in 2009, when valuations slumped 3.2 per cent.
August and September saw drops of 1.8 and 2.1 per cent respectively as activity fell sharply in the wake of the Brexit vote at the end of June.
Reuters adds that transaction volumes have been slowing in top-priced London postcodes since a three per cent stamp duty surcharge was added for second-home buyers in April.
"The timing, which brought forward many purchases and resulted in a slump afterwards, makes it difficult to disentangle the effect from the uncertainty created by… the decision to leave the EU," it says.
Prime central London "stretches from Kensington and Notting Hill in the west to the City of London in the east," Reuters says. Chelsea recorded the biggest hit, with prices down close to ten per cent.
However, the rest of the country, after an initial blip following the Brexit vote, is seeing buyer demand return and valuations improve.
Halifax's monthly index shows UK house prices rose for the second month in a row in October, increasing 1.4 per cent, well ahead of economists' consensus forecast for a 0.2 per cent rise, reports The Guardian.
Not all analysts are convinced this can last, however.
Howard Archer, of IHS Insight, predicts the impact of the UK's vote to leave the EU will hit more next year and that while "house prices may well rise modestly in the near term", they will fall materially over the coming 12 months.