Home sellers in London’s upscale Chelsea neighborhood have had to cut prices by at least 12% on average to entice buyers to open their wallets.
The neighborhood, which is home to the likes of Pippa Middleton and Russian billionaire Roman Abramovich, saw the biggest annual fall in asking prices in November in prime central London, according to Knight Frank’s latest health check of the housing market released Tuesday.
The second and third biggest drops last month were in Hyde Park and Kensington, which witnessed decreases of 11.2% and 9.1% respectively, Knight Frank data shows.
Only three areas—Islington (1.1%), City Fringe (2.2%) and Tower Bridge (0.2%)—saw rises, but these are areas where prices are generally lower than in Chelsea, Kensington and Knightsbridge (home to the famous Harrods department store).
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Overall, prices in prime central London slipped by 4.1% in the year to November, compared with a 2.3% drop in the 12 months leading up to October. Knight Frank is predicting that prices will end 6% down in 2016 and be stagnant in 2017.
According to Tom Bill, head of London residential research at Knight Frank, these “overdue asking price reductions” have in some cases “been prompted by the wider political uncertainty” generated by the Brexit “yes” vote.
Sellers have also had to adjust asking prices as the market responds to higher stamp duty rates at the top end of the market, which were introduced in December 2014, he added. The adjustments, in turn, helped transaction volumes stabilize since the summer.
Sales were down 40% between May and June compared with the same period last year, while from September to November, prices were 25% lower than last year.
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