Property prices in London slumped further downwards for the fourth month in a row, and though a collapse remains highly unlikely, predictions for the capital over the coming year remain muted.
While England’s average property price swelled by 2.9% in the year to May 2018, bringing the average value to £243,583, London suffered a 0.4% fall over the past year, marking the fourth consecutive house price drop for the capital on a monthly basis.
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This is according to the latest UK house price index from the HM Land Registry and Office for National Statistics (ONS) released this week, which looks at all completed property transactions during the period for each month, in contrast to the Zoopla and Rightmove indices which focus on asking prices.
In total, 20 out of 33 London boroughs experienced a decline in their average property value on an annual basis to May 2018, with a typical home in the capital now selling for £478,853 – which is still by far the highest price in the country, and well above the UK average.
More falls expected in the capital
As London continues to struggle with deflating prices, with issues such as Brexit uncertainty and forthcoming interest rate rises affecting buyer confidence in the capital, most experts still agree that a full-scale collapse is highly unlikely.
Richard Snook, senior economist at consultants PwC, said: “Regional figures can be volatile from month-to-month but the figure supports an underlying weakness in the market, the latest figure for May shows that prices are 0.4% lower than the same time last year.
“In our regional forecasts we predict price falls in London in 2018 and 2019 of 1.7% and 0.2% respectively.”
North holding up price growth
Elsewhere in the country, though, the picture is far from bleak. In Manchester, for example, house prices shot up by 7.5% between May 2017 and May 2018, from £158,994 to £170,903, as the city gains popularity as a top investment spot and place to live outside the capital.
Birmingham also saw strong performance with a 6.9% rise over the year from £168,617 to £180,320, while the east Midlands as a region had the fastest growing house prices in the country with an overall average increase of 6.3%.
Leeds saw prices climb by an above average 4.3% annually, from £170,636 to £177,983, as the north continues to buck the trend for the country.
