Average prices for prime property in central London declined 1.1% in the year to February, according to a Knight Frank report released Tuesday.
The marginal adjustment means that though prices are now 8% below their previous peak in August 2015, the city is facing more stable market conditions, the London-based property consultants said.
As pricing has stabilized, so have trading volumes. There was a 2% increase in sales volumes in the year to February compared to the previous 12-month period, the report said, and the number of properties listed for sale was 5.4% higher in February than the same month last year.
“While the market remains sensitive to political events there currently appears to be a sense of (relative) stability being restored,” said Tom Bill, Knight Frank’s head of London residential research, in the report.
“However, we do not believe the sales market is poised to enter a strong upswing in terms of pricing or trading volumes,” he added, pointing toward continuing political uncertainty surrounding the Brexit process.
Prime central London properties priced between £5 million and £10 million (US$7.03 million to US$14.06 million), logged the biggest—and only—price growth in the year to February, up 1.2%, according to the report.
Prices for homes over £10 million remained flat, with no price change. While properties priced between £1 million to £2 million (US$1.4 million and US$2.8 million) and £2 million to £5 million (US$7.03 million) dropped 1.4% and 1.8% respectively.
Prime central London’s average rents logged declines, too, falling 1.5% in the one-year period to March, which was the most modest rate of decline in almost two years, the report said.
Despite this, supplies are down, thanks to increasing stability in the sales market and tax changes in recent years, including a stamp duty surcharge for additional homes. The number of new rental listings fell 5% in the 12 months to February.
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