Houses considered prime property in London are at their cheapest values since 2010, with prime flat properties repricing back to levels not seen since 2012. This is according to estate agent Property Vision, in their recent Prime Central Index for 2019.
This comes at a time when the average London home is estimated to have reached its cheapest value since 2016.
Housing in areas deemed to be prime real estate in London by Property Vision were estimated to have peaked in 2014-15, and have seen sustained price declines, making them 25 per cent cheaper. This fall now means prime London housing is at its cheapest since 2010.
Prime London flats also peaked in 2014-15, with a less pronounced decline of 21.7 per cent in the past five years, according to the Prime Central Index. These properties are now considered to be back to price levels not seen since 2012.
Prime flats show greater weakness
Prime London flats have shown greater price weakness than prime housing in 2019 so far, according to Property Vision. Prime flats are already 8.4 per cent cheaper than the same period in 2018, compared to a fall of 6.2 per cent for prime London homes.
In a recent press release, Property Vision stated: “We have commented before that the relative outperformance of flats mirrors buyers’ tastes in London…predominantly domestic buyers have given way to the international – who may not see the charm of staircases and are used to living over one floor.”
Given the greater weakness of prime flats in London, they speculated: “The less-sophisticated have been burned by ill-advised purchases of fancy looking flats bought off-plan when growth seemed limitless.”
Transactions in spite of Brexit
Property Vision believed a significant fall in turnover was behind the overall decline in prime London property prices, but that the effect of Brexit wasn’t so clear-cut as an obstacle for investors, given the fundamentals of the UK economy.
They also commented: “As a general rule, the further you are from Big Ben, the less the conversation comes round to Brexit, and if you are sitting in Hong Kong (where prices are double those in London), the market and the currency are giving you prices in London that are 50 per cent lower than give years ago.”