London Home Owners are not Rushing to Sell Quickly
When purchasing property, people often think about two things: location and return on investment. It is hard to imagine a location better than London for return on investment, but Rightmove Confirms that the London property market is struggling. Similarly Direct House Buyer has reported that the bubble has probably burst or at least reached its's high point.
The property-listing website reports a 1% drop in asking prices in London from the year before, the sixth consecutive fall for the capital city. In January, property prices dipped almost 1.5% to their lowest amount since August 2015. However, property prices in the UK rose 4.4% from the month before, signaling the usual spring selling cycle upswing.
The Rest of the UK has Experienced Quicker Gains
The London house prices are predicted to fall by 2% during 2019 they have already started to decline and showed a 0.1% decline at the end of 2018, other than the 2008 recession this is the second decline in 23 years. Regardless house prices are in London are still almost double to what they were in 2007 so are still unaffordable compared to incomes.
Brexit uncertainty has halted demand and the years of relentless inflation has pushed buyers out of the city. While there is a cooling-off of prices, the average price of a house in London is down 2.1 % in a year and is £614,182, more than 20 times the average UK salary. The average deposit in London is more than £90,000, which means there is a very limited number of buyers who can purchase in that market.
For owners who want to sell in the down-turning London market, they will not only have to be more realistic with asking prices but also more patient. The average time to sell a property in the capital is up from 73 days a couple of years ago to 89 this day.
London Home Owners are not Rushing to Sell Quickly
The slowed market has created weary sellers, which is slowing the cool down and limiting damage. There is a long tradition of high demand and low supply in the city and cautious sellers are not panicking to sell fast. Property prices generally re-adjust quickly after a boom if sellers panic and flood the market, but the London market and investors are resilient, and the would-be-sellers are showing patience to prevent prices from dropping further. This slowdown could result in volumes to fall by up to 10% this year, according to Jefferies Bank.
Although the volume slowdown is not exclusive to London. Nationally the numbers of interested buyers and properties coming to the market fell in January according to RICS. New buyer interest fell for the 10th consecutive month suggesting that the subdue market will continue.
New figures from the Rightmove House Price Index show that London is currently the second slowest market to sell your home in the UK and it currently takes 66 days on average. It appears that times have changed and it's not the fastest moving market anymore, in fact the West Midlands with Scotland in close second retain spot one and two with it taking around 65 days to sell your home, a surprising contrast to the amount of time it takes to sell in London which is 89 days. If your looking to sell your house fast fill out the contact form and get in touch.