Average prices in prime central London fell by approximately 1% in the year to February. But the marginal dip—witnessed for the third consecutive month—is good news, according to Friday’s report by global real estate consultants Knight Frank.
It points to further evidence that pricing in the capital appears to have stabilized following steeper declines over the last two years, the report said.
In comparison, prices in the city fell 7.9% between August 2015 and February 2017.
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Neighborhoods in the city recorded varying performances in the past year, with the strongest growth logged in Marylebone (3.5%), likely due to the area’s high-quality new-build pipeline and relative renaissance, the report said.
Bayswater (2%) and Notting Hill (1.1%) also reported moderate growth.
Knight Frank could not provide individual figures for London’s other markets over the past year.
High-end buyers have been seen taking advantage of slightly lower prices in the city. In Chelsea for example, a recent uptick in transactions priced at £5 million (US$6.88 million) and above is thought to be the result of a 15.6% drop in home values in the area between August 2015 and February 2017, according to Knight Frank.
"We have observed that there is a real sense of purpose now from many of the buyers that we are dealing with," said James Pace, head of Knight Frank's Chelsea office, in a statement to Mansion Global.
"What we are noticing is that many buyers that have been sitting on the fence for some time are beginning to be much more motivated and offers are coming in on many properties that we are marketing," Mr. Pace said, noting that Chelsea has over the past couple of years been more affected by weaker market conditions than many other areas in the city.
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Though it’s happening slowly, recent figures show rental values in London are bottoming out too, according to the report.
Average rental values in prime central London fell 2.1% in the year to February—marking two years of annual rental value declines—though compared to the decline of 5.1% recorded in February last year, the numbers underline how rental values are bottoming out, Knight Frank said. Knight Frank did not specify where the average rental value now stands.