THE London property slump has dramatically accelerated with prices falling at their fastest rate in almost a decade, official figures reveal today.
The average price of a home in the capital dropped 4.4 % to £457,471 in the year to May, the steepest rate of decline since August 2009 when the market was still reeling from the devastating impact of the financial crisis.
The latest “punishing” downward lurch means that more than £21,000 was wiped from the value of the average London home over the 12 month period, according to the data from the Land Registry.
It was the 15th consecutive month of year on year falls and means that the market is now 6.4 per cent below the peak it reached in August 2017.
The data shows that May was a particularly bad month with prices tumbling 2.5 per cent, the biggest monthly fall since the 3.15 % recorded in May 2011.
Experts said the figures recorded at the Land Registry reflected deals agreed several months earlier when the Parliamentary battles over Brexit shattered lingering confidence in the property market.
Some boroughs saw huge annual falls in prices with Barnet down 9.6 %, the City of London lower by 8.3 % and Southwark falling 5.8 %.
Although the correction is not yet on the scale of the full scale routs seen in the early Nineties, and more briefly during the financial crisis, it will alarm recent buyers who fear they may have clambered on the property market at the worst possible time.
But a return to a buyers’ market will encourage young renters who thought they would never be able to afford to own a home in the capital.
The London market has flatlined for half a decade with tax changes, fewer foreign buyers, more cautious mortgage lending and the massive uncertainty over Brexit all contributing to the slowdown.
Today’s figures also show that the number of sales is still in decline with just 5,947 recorded across the capital in March, the most recent month for which data is available. This was down from 7,350 a year previously.