Prime central London’s property market logged further price declines in June, as sales values dropped 1.8%, according to a report released Tuesday from Knight Frank.
The current residential real estate downturn impacting the city is now in its 35th month, the London-based brokerage and property consultants said, bogged down by tax bumps on top-tier properties, penalties for second-home buyers and Brexit-related uncertainty.
Though all price bands of properties in central London’s poshest neighborhoods witnessed falls in prices last month, it was the ultra big-ticket homes that logged the smallest price drops.
Sales values for homes priced over £10 million (US$13.16 million) fell 1% in the year to June, and those priced between £5 million (US$6.58 million) and £10 million fell 1.2%.
In comparison, property priced below £1 million (US$1.31 million) and homes priced between £2 million (US$2.63 million) to £5 million fell 1.4%, in the same time frame.
Homes priced between £1 million to £2 million fell in value 1.6%.
Weighing on prices is rising stock levels, the report said.
Inventory of listings priced at over £1 million in prime central London was at its highest level in May since October 2016.
“Supply has risen as more landlords attempt to sell following tax changes and as sales pricing appears to bottom out,” said Tom Bill, head of London residential research at Knight Frank in the report. “Some properties have gone back to the lettings market as asking prices are not met but the trend may still weigh on sales prices.”
Demand, meanwhile, remains price sensitive and driven to an increasing extent by buyers with a need to move, such as schooling or downsizing, the report said.
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