Housing market slumps as London drag continues

The UK housing market has dipped, exacerbated by a large -2.9 per cent monthly drop in house prices in London.
Data from the Rightmove housing price index for September 2017 shows that the price of property coming to market has fallen by 1.2 per cent (-£3,660) this month, the first monthly fall at this time of year since 2013.
London experienced a decrease in housing prices in five out of the six most expensive London boroughs, driving down the average prices this month, and pushing annual rates down to -3.2 per cent. In contrast, the more affordable London boroughs are rising year-on-year.
Whilst the national average price fall was exacerbated by London’s continued readjustment particularly in the higher-end boroughs, there is potentially good news for buyers’ finances, with the average earnings of +2.1 per cent now almost double the annual property price increases of +1.1 per cent – the lowest annual rate of house price increase since February 2012.
Miles Shipside, Rightmove’s Housing Market Analyst comments: “As we enter the Autumn selling season it is usual to see estate agents advising new-to-the-market sellers to push up their asking prices. But this year … estate agents are clearly advising many sellers that they have to lower their price expectations to fit in with buyers’ stretched financial resources, with that price compromise hopefully generating extra buyer interest.”
Commenting on the Rightmove report, Roger Collings, Branch Manager at RE/MAX says: “Since the introduction of the 3 per cent surcharge on stamp duty paid by investors, along with the uncertainty as to how Brexit will impact London’s property market, investors have been standing on the sidelines. We are beginning to see more and more investors venturing back into the market, but we are still a long way from the volumes we saw pre-referendum. There are markets outside of central London that are still buoyant with local buyers.”
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