London’s Housing Boom Is Over, Rightmove SaysBy
U.K. capital’s home prices are in ‘adjustment,’ Rightmove says
Asking prices fell 1% in February versus year earlier
London’s property market has moved out of its boom phase and home sellers need to be more realistic about their price demands, according to Rightmove.
The February report from the home-listing website shows that asking prices were down 1 percent from a year earlier, a sixth consecutive fall. They rose 4.4 percent on the month, reflecting the usual jump at the start of the spring season.
The capital’s housing market lagged the rest of the U.K. in 2017 and there’s little to suggest any upturn is in store. Still, while multiple reports point to a cooling in London housing, the damage is being limited by cautious sellers, who aren’t flooding the market in a panic to dump property. That means the long-running supply-demand imbalance in the city is providing some support to prices.
“End-of-the-boom prices normally readjust more quickly if there is an over supply,” Miles Shipside, Rightmove director, said in the report. However, “some would-be sellers are holding back, preventing a glut of competition from forcing prices downward,” he said.
Brexit uncertainty has damped demand, while years of rampant inflation has pushed ownership out of reach for many. The mean asking price in London this month was almost 630,000 pounds ($885,000), more than 20 times average U.K. earnings.
For those who need a fast sale, Shipside’s advice is to “sacrifice some of the substantial price gains of the last few years.” The average time to sell a property in London is now 83 days, up from 73 days a year ago.
Nationally, asking prices increased 0.8 percent in February from January, though that was below the 10-year average for the time of year. The average price of 300,000 pounds is up 1.5 percent year-on-year. That compares with gains of about 6 percent seen less than two years ago.
— With assistance by Mark Evans