With high taxes, Brexit jitters, and the “don’t move improve” craze still going strong, London’s homeowners are starting to boycott the capital’s troubled sales market - leading to a record drop in the number of homes on offer in the capital.
The number of properties put up for sale has plunged by almost 14 per cent in the last year as Londoners “lose that moving feeling”, according to Rightmove.
More than 40,000 properties in Greater London are listed for sale on the website, but the lack of fresh listings for buyers to choose from is constricting growth in asking prices, which has slowed to 2.3 per cent year-on-year.
Homes in inner London have seen a below-inflationary growth of just 0.1 per cent, while in outer London the performance was a stronger 4.9 per cent.
Miles Shipside, housing market analyst at Rightmove, says this is because buyers are rippling out of Zones 1 and 2 in search of “more house for their money”.
“There seems to be a marked reluctance this year compared to last year for homeowners to put their property up for sale, with 13.7 per cent fewer homes coming to market in London,” said Shipside.
“While 2016 overall saw a relative surge of new sellers, driven by some trying to cash-in before prices fell, 2017 has started with a marked lull.
“Owners now seem well aware of the more challenging conditions, with high Stamp Duty costs and Brexit uncertainty perhaps making them hold back from trying to sell. Whilse it is too early to say that this is a trend that will continue for the rest of 2017, for the moment some Londoners seem to have lost that moving feeling.”
Robert Nichols, managing director at Portico estate agents fears a shortage of stock will reduce the number of sales in the capital this year as buyers struggle to find a home they want. This, in turn, will have an impact on prices.
“We have already seen a year-on-year price drop in Westminster, and it is possible that this price correction could ripple out to greater London,” he said. “We do however still expect certain hotspots in the outer London zones - like East Croydon, Forest Gate and Leyton - to experience price growth - though perhaps not at the level we’ve seen in previous years.”
Over the last year the borough which has seen the biggest increase in asking price was Hackney, with annual growth of 15.5 per cent. Bromley has enjoyed average increases of 11.6 per cent.
However nine boroughs – almost a third of London – saw prices fall, with drops concentrated in the most expensive locations like Camden (down 16.4 per cent) and Hammersmith and Fulham (down 11.6 per cent).