Latest Index Shows London Housing Bubble Has Burst
New data from Home.co.uk shows dramatic price falls in central and greater London that seem to herald the end of the London housing bubble, which is bad news for both landlords and vendors. Doug Shephard, the director of Home.co.uk , says that despite the predictions of an inevitable end to London’s inflation the price drop has still come as a shock to many. London’s “synthetic property boom”, he says, will be hard to come back from.
15 UK areas recorded a negative % yield in rental properties, and unsurprisingly 12 of those were in Central London: for landlords of Walworth properties this was 11.3%, and for Belgravia 7.1%. Clearly the situation for landlords in Central London will get worse before it gets better, and there is likely little in the way of government initiative that could improve this situation.
The biggest falls in house prices occurred in central and prime London property areas. Between January 2014 and January 2015 average house prices in Walworth fell by 15%, with Belgravia and Kensington experienced a slump of 10.3% and 8.3% respectively. In fact, since November 2013, the average flat price in Belgravia has fallen roughly 20%. Even Greater London is not safe from these price falls: flats in Holloway have fallen by 13% since May 2014, and in less than six months flats in Muswell Hill have seen a price drop of 4%. On average the price of a flat in Central London fell by 9% within the last year. 11 of the 20 UK areas that experienced the most significant falls in prices are located within London.
With confidence in London housing market investments falling quickly, the future for London’s landlords and vendors seems uncertain, but possibly grim.
Read more at http://www.propertywire.com/news/europe/central-london-property-prices-2015020910134.html