London property prices will crash the most in '09
By Lorna Bourke | 00:01:00 | 02 December 2008
Even the rich are feeling the pinch with the value of Prime Central London properties crashing for the second month in a row. Latest figures from chartered surveyor Knight Frank reveal that prices fell 3.6% in November, the second largest fall on record after the collapse of 3.9% in October
Prices are now 14.1% lower than a year ago, the biggest one year fall since the index began in 1977, and have dropped by 9.3% over the last three months alone. ‘Prices for prime central London property have now been falling for eight consecutive months,’ commented Liam Bailey, head of residential research, Knight Frank. ‘In June 1990, at the height of the last slump, the annual fall amounted to just 10.6%.’
And the falls are across the board with houses, which until recently had held up well, now falling as fast as flats. ‘The value of houses in prime areas of the capital fell by 4.1% in November, a greater decline than the 3.2% recorded for flats. Consequently, areas with a greater number of entire houses, such as the northern areas of prime central London, are no longer outperforming the market,’ Bailey said.
And the slowdown is now affecting the rich as well as the average homeowner. ‘Super-prime property worth over £10 million was still increasing in value until the summer. Now, however, it has seen three months of consecutive falls and values are 7.5% lower than at the market’s peak in August. Nevertheless, properties worth over £5 million are still holding value better than cheaper homes, with values falling by 1.9% during November, compared to 4.3% for those priced at under £5 million, Bailey pointed out.
Much of the decline can be attributed to the fact that those who have to sell are realizing that they must cut their prices to find a buyer. But there is one bright spot on the horizon. ‘These dramatic falls may be painful to vendors, but prime London property is increasingly looking like very good value, particularly to foreign buyers who also benefit from the weak pound,’ Bailey explained.
This view is shared by chartered surveyor Jones Lang Lasalle which is predicting a further fall in property prices of between 13% to 15% in 2009, slowing to a fall of around 1% to 3% in 2010 with the fourth quarter of 2010 hitting the bottom of the market.
London house prices will fall fastest next year – prime central London by 16-20%, greater London by 15-17%. But London house prices will recover first and will be rising again before end-2010.
The peak to trough fall in UK house prices will be around 29% and it will take around eight and a half years, until 2016, for prices to recover to 2007 peak levels. This is in line with the last housing crash in the early nineties when prices peaked in 1989, fell until 1992 and took until 1997 to regain their 1989 highs.
http://www.citywire.co.uk/personal/-...=4289&ea=64414
By Lorna Bourke | 00:01:00 | 02 December 2008
Even the rich are feeling the pinch with the value of Prime Central London properties crashing for the second month in a row. Latest figures from chartered surveyor Knight Frank reveal that prices fell 3.6% in November, the second largest fall on record after the collapse of 3.9% in October
Prices are now 14.1% lower than a year ago, the biggest one year fall since the index began in 1977, and have dropped by 9.3% over the last three months alone. ‘Prices for prime central London property have now been falling for eight consecutive months,’ commented Liam Bailey, head of residential research, Knight Frank. ‘In June 1990, at the height of the last slump, the annual fall amounted to just 10.6%.’
And the falls are across the board with houses, which until recently had held up well, now falling as fast as flats. ‘The value of houses in prime areas of the capital fell by 4.1% in November, a greater decline than the 3.2% recorded for flats. Consequently, areas with a greater number of entire houses, such as the northern areas of prime central London, are no longer outperforming the market,’ Bailey said.
And the slowdown is now affecting the rich as well as the average homeowner. ‘Super-prime property worth over £10 million was still increasing in value until the summer. Now, however, it has seen three months of consecutive falls and values are 7.5% lower than at the market’s peak in August. Nevertheless, properties worth over £5 million are still holding value better than cheaper homes, with values falling by 1.9% during November, compared to 4.3% for those priced at under £5 million, Bailey pointed out.
Much of the decline can be attributed to the fact that those who have to sell are realizing that they must cut their prices to find a buyer. But there is one bright spot on the horizon. ‘These dramatic falls may be painful to vendors, but prime London property is increasingly looking like very good value, particularly to foreign buyers who also benefit from the weak pound,’ Bailey explained.
This view is shared by chartered surveyor Jones Lang Lasalle which is predicting a further fall in property prices of between 13% to 15% in 2009, slowing to a fall of around 1% to 3% in 2010 with the fourth quarter of 2010 hitting the bottom of the market.
London house prices will fall fastest next year – prime central London by 16-20%, greater London by 15-17%. But London house prices will recover first and will be rising again before end-2010.
The peak to trough fall in UK house prices will be around 29% and it will take around eight and a half years, until 2016, for prices to recover to 2007 peak levels. This is in line with the last housing crash in the early nineties when prices peaked in 1989, fell until 1992 and took until 1997 to regain their 1989 highs.
http://www.citywire.co.uk/personal/-...=4289&ea=64414
Comment