London house prices: capital is UK's cheapest property market as thousands knocked off value of average home
London house prices fell for the third year running in 2019, wiping more than £8,600 off the average value of a home in the capital, according to a new survey.
Values dropped by 1.8 per cent over the course of the year making the capital the weakest regional property market in the country, figures from mortgage lender Nationwide today reveal.
Prices have not risen over the course of a year since 2016 when they peaked at just over £473,000. They fell by 0.5 per cent in 2017 and 0.8 per cent in 2018. Last year’s decline brought the average price in the capital down to £458,363.
Nationwide’s chief economist Robert Gardner said: “London ended the year the weakest performing region, with an annual price decline of 1.8 per cent.
“While this marks the 10th quarter in a row that prices have fallen in the capital, they are still only around five per cent below the all-time highs recorded in the first quarter of 2017 and around 50 per cent higher than their 2007 peak.”
Nationwide forecast that prices are likely to remain “broadly flat” over the next 12 months. Mr Gardner said: “Much will continue to depend on how quickly uncertainty about the UK’s future trading relationships lift as well as the outlook for global growth.”
However, some commentators said the decisive outcome of last month’s general election is likely to herald a modest recovery in the London property market over the coming year.
Jonathan Samuels, chief executive of property lender Octane Capital, said: “London may have been the weakest performing region in 2019 but that may well change this year. The capital certainly won’t be returning to the obscene growth rates of yesteryear but it may drag itself off the bottom of the table.
“While prices are likely to pick up in 2020 as a significant amount of pent-up demand comes through in the aftermath of the general election, the vital trade negotiations taking place will continue to keep the property market honest. What’s essential is that values don’t suddenly get ahead of themselves.”
North London estate agent Jeremy Leaf said: “The latest Nationwide figures confirm what we are seeing at the sharp end — that buyers and sellers are shrugging off continuing concerns about Brexit and taking advantage of improved affordability while negotiating hard so price rises remains modest.
“This determination has been evidenced by the number of sales and lettings beginning to be negotiated between Christmas and New Year, with the number of market appraisals we have seen higher than the same time last year.”