Prices in this hotbed of global wealth fall most since 2009
London’s property market is estimated to be worth as much as the annual GDP of the world’s ninth biggest economy, Brazil. But prices are falling.
In April they fell 1.5% year-over-year, to £636,777, according to Rightmove, a firm specialized in real estate. The last time prices fell so sharply was in May 2009, when the global financial crisis was gaining steam. The worst hit areas are London’s most expensive boroughs.
Those at the top end of the global wealth and income scale — just about the only people left who can afford to buy residential property in London these days — either have less money to spend or are spending it elsewhere. Some are even splashing it around other parts of the UK, where better value deals can be found.
For the last two years the UK’s prime regional housing markets have outperformed London’s top postcodes, as higher taxes and Brexit uncertainty have chilled the capital’s prime markets. According to Lucian Cook, head of residential research at Savills, values in the prime central London market are 13% below their 2014 peak. The main factors driving this trend include changes to UK stamp duty as well as international buyers’ increased exposure to capital gains tax and inheritance tax, leading to more reluctance in taking advantage of the weaker sterling…