The State of the London Property market

No one could have failed to notice that once again the property market is creating sensational headlines in the national press. The media are now reporting price drops of 25% - 30% from their peak in 2007. In real terms, we are back to prices of 2006

It should be noted that much of the media is commenting on the market as a whole throughout the UK and it must be remembered that London does not always follow the trends which may be occurring across the rest of the country.

Six months ago it was reported that nationally prices had dropped by 10% - 13%. As estate agents specialising in central London we knew that in the capital prices had by dropped far more then the margins reported due to the soar in prices we saw in 2007.

The vast majority of central London agents took this on board and six months ago began to readjust their property valuations to suit the mood in the city, dropping prices by 20%-30% leading the way for the rest of the country. Thus in London property prices have already been adjusted and the reports that are coming through now of another 30% drop in prices are far more applicable to the rest of the country, as in central London it has already happened. Due to the capital reacting to the financial crisis a few months ago property prices have already taken a substantial tumble which is now having a knock on effect across the country.

One crucial point that seems to be getting a little muddled with all the turbulence in the financial markets is that property is a long term investment. Looking at the history of house prices apart from the occasional blip prices have been steadily raising since records began. Over a decent period of time there is no doubt that your property will increase in value.

Home owners stay on average between 5 and 10 year in their current location, how much do you think your house will be worth in 10 years time?
(Traditionally London House prices double every 10 years).

Notting Hill and Ladbroke Grove are now back to 2006 price levels and buyer are seeing great value; The Bank of England has made a shock two-and-a-half percentage point cut in UK interest rates to 3%, the lowest level since 1955.

So If you are thinking of buying the key is to be realistic, make sure your estate agents understands your needs and wants, it is a buyer market so do not hesitate to make an offer, you just never know.