London house prices drop at the fastest pace since 2009

LONDON: London house prices are falling at the fastest pace since the depths of the recession almost a decade ago, with the capital’s most expensive areas seeing the biggest declines.

Average prices fell to £593,396 in January, an annual decline of 2.6%, the most since August 2009, according to a report published by Acadata. London’s highest-priced boroughs were the biggest losers, while the largest single drop was recorded in Wandsworth, down almost 15%.

Weakness in prime property in London in recent years – partly due to tax changes – has spread to other locations in the city and around the Southeast. Nationally, slower economic growth and faster inflation since the Brexit vote are weighing on the market, while the Bank of England is raising interest rates, adding to the downward pressure.

Media coverage of the slowdown has meant headlines about falling house prices, which is making consumers nervous and holding back demand.

New buyers registering with real estate agents fell for an 11th month in February, the Royal Institution of Chartered Surveyors said last week. London prices fell 0.8% in January alone, according to Acadata, which publishes detailed regional data with a one-month lag.

That shows the weakness that was present for much of last year continued into 2018. — Bloomberg